A busy WEF agenda, Hurricane Ian revisited and flood risk innovation

At the 2024 World Economic Forum, a dizzying array of issues competed for attention. But climate change retained a prominent position on attendees' agenda, even as they wrestled with the challenges of geopolitics, AI and higher inflation. Swiss Re CEO Christian Mumenthaler weighed in during WEF panel discussions and interviews with global media.

Also in this newsletter: Hurricane losses and population growth; flood risk for corporates; 2024 prospects for cat bonds; a new water risk innovation partner; and our celebration of 160 years of risk knowledge.

Swiss Re's Mumenthaler on net-zero: "Behind the scenes, there's no hesitation"

The 2024 edition of the World Economic Forum (WEF) in Davos, Switzerland, offered global leaders a chance to discuss the world's most vexing problems. Though ongoing wars in Ukraine and the Middle East understandably captured much of this year's WEF limelight, the generational challenge of climate change remains a priority for company executives pursuing crucial net-zero goals.

"Geopolitics is trumping everything right now. But behind the scenes, there's no hesitation," Swiss Re CEO Christian Mumenthaler told a CNBC interviewer, about efforts by corporations to address their own greenhouse gas emissions, and those of their suppliers. "I think it's going to accelerate massively."

?? To watch his interview, click here .

Mumenthaler, co-chair of the 126-member Alliance of CEO Climate Leaders , has won recognition from the TIME magazine for his work advancing sustainability in insurance. In Davos, he also joined a session entitled "Are the financial risks of climate change underpriced?" that's been called a "must-watch" WEF event.

Together with mitigating climate change, a recurring theme at WEF and beyond is climate adaptation, as urgency grows for societies to gird themselves for the unavoidable impacts of a warming planet. Veronica Scotti , chair of Swiss Re's Public Sector Solutions business, authored an article about adaptation, and in a separate video message recapped her 2024 WEF experience, including a session on the threat of extreme heat for vulnerable workers. As Scotti says: "We need the creativity and the ability to really bring protection in a different way."

Andreas Berger , who heads up Swiss Re's Corporate Solutions business, also engaged with partners during an intense week in Davos, where he emphasised the importance of building trust and collaboration. In a separate article, Berger weighs in on harnessing the power of technology to solve challenges that accompany a warming planet. "Climate change opens entirely new dimensions of risk – natural, economic and political," Berger writes. "It is already evident that climate change can contribute to resource scarcity."

Population growth and hurricane damage

Tropical cyclones are among nature's most destructive phenomena, as we witnessed again last year with Hurricane Otis in Mexico and Idalia in Florida. But factors beyond mere storm intensity contribute significantly to damage they leave behind, in particular population growth, the accumulation of valuable man-made assets and building standards that can help structures ride out even the fiercest weather. That's why people, companies, and communities must consider the interplay of growth, development, and storm risk to prepare for Mother Nature's whims in decades to come.

Late last year, Swiss Re experts examined these connections at the one-year mark of Hurricane Ian, whose landfall in Florida became one of history's costliest tropical cyclones. Check out Ian revisited: Disentangling the drivers of US hurricane losses | Swiss Re . You can also read what one of our top US underwriters, Matt Junge , had to say here:

?? After hurricane Ian I Swiss Re models | Swiss Re .

What's in a name?

Ever wonder how hurricanes are named? The World Meteorological Organization keeps a rotating alphabetical list for Atlantic hurricanes. The more named storms, the deeper WMO experts get into the alphabet. Lists are re-cycled every six years. That means the 2023 list returns in 2029, but with this caveat: The names assigned to notorious storms get retired , a bit like the jersey numbers of sports superstars. It probably comes as no surprise that Ian has joined the hurricane hall of fame. If enough storms brew in 2028 to get to the alphabet's ninth letter, we'll have Idris on our hands, according to the updated list. Here's hoping Idris is a bit kinder to us than Ian!

Climate change driving flood risk

Many corporates that are natural partners of Swiss Re Corporate Solutions have expansive operations covering multiple geographies. The risk of catastrophic flooding is of paramount concern to corporations seeking to protect their valuable installations. In this podcast , Corporate Solutions Chief Claims Officer Marc Scheidegger discusses flood risks, as well as the role of data and technology in boosting flood resilience. As Scheidegger says, "Flood risks have not only become more frequent, they've become more unpredictable, with climate change being one of the drivers for this." By the way, you can check out the rest of this claims podcast series here .

Can you Fathom better flood protection?

Speaking of high water, Swiss Re is always scanning the horizon for risk innovations, including to help us better assess flood risk. Sometimes, what we discover is so good that we decide its true value to our clients would be better realised if it were part of the Swiss Re group. We found a perfect match recently when Swiss Re agreed to acquire Fathom , a UK-based water risk intelligence firm whose tools will augment our solutions for our Property & Casualty partners. Fathom's 50 employees build the world's most-comprehensive flood models. Based on a suite of in-house technology, their spectacular models – practically works of art – are already being used to help companies, the public sector and international organisations understand and prepare for flood risk.

Cat Bonds

Since their inception in the 1990s, catastrophe bonds have established themselves as an option ?to expand risk protection capacity, in particular as weather grows more volatile. Property and casualty insurers as well as reinsurers like Swiss Re can utilise cat bonds as complementary tools to transfer some peak risk of storms or earthquakes to capital markets. Our Alternative Capital Partners unit's clients include everyone from cedants to investors looking to benefit from Swiss Re's broad experience in the insurance-linked securities (ILS) market. If you're wondering how the cat bond universe fared in 2023, the Swiss Re Institute offers this report Swiss Re Institute┃Catastrophe bond issuance | Swiss Re , including an outlook for 2024, when our experts say last year’s record-issuance momentum may continue. By the way, cat bonds aren't just for nat cats, either.

?? For more on Swiss Re's recent cyber cat bond, have a look here .

And in case you missed it…

In December, Swiss Re celebrated its 160th birthday. To mark our 1863 start, we created Celebrating 160 years︱Reinsurance, reinvention, resilience | Swiss Re where you can read Acting Chairman Jacques de Vaucleroy 's message and get to know us better. This is less a sentimental journey than it is a reminder that as future risks take shape, Swiss Re is working to stay ahead of them to fulfil its enduring purpose : Making our world more resilient.

You can also catch up on our collaboration with freelance journalist and climate enthusiast, Alexander Verbeek , and watch him interview Swiss Re experts about climate issues he witnessed while walking the Camino de Santiago, the ancient European pilgrimage route whose landscape is undergoing rapid change as global temperatures rise.