Climate change to be included in SII Standard Formula
- Global warming will have serious consequences for human health, biodiversity, ecosystems and the goods and services they provide, as well as for many social and economic sectors, including agriculture, tourism, and energy production.
- Climate change is expected to affect water availability and increase water scarcity throughout Europe. Changes have been observed in river flows, with reductions in southern and eastern Europe, and increases or seasonal changes in other regions.
- In most of Europe, less precipitation in summer and rising temperatures will lead to more frequent and intense summer droughts. The Mediterranean region is already experiencing these effects, and is expected to suffer from more extreme droughts in the coming decades, together with other regions, such as central Europe.
- Sea level has been rising over the 20th century, and the tendency has accelerated in recent decades. Around a third of the EU population lives within 50km of the coast and these areas generate over 30% of the Union’s total GDP. The economic value of assets within 500m of Europe’s seas totals between €500-1,000 billion. Source: https://ec.europa.eu/clima/policies/adaptation/how_en
EIOPA has published a discussion paper to consider if, and how, to include climate change in the natural catastrophe SCR calibration in the Standard Formula.
The paper provides a succinct explanation of the methodology currently in place, elaborates on climate change in Europe by analysing which perils/countries are impacted, and goes on to consider what the methodology could look like when encompassing climate change.
EIOPA welcomes comments on the methodology on potential inclusion of climate change in the Standard Formula.
