Thomas Buberl Chief Executive Officer of AXA

Public Health and Climate Change: a Perfect Storm

An op-ed by Thomas Buberl (AXA), Head of the Health Global Business Line, Jay Ralph (Allianz), and Maurice Tulloch (Aviva) on the report "Policy Responses to Protect Public Health".
Jan 7, 2015

Today, the Lancet Commission on Health and Climate Change released a ground breaking report on Policy Responses to Protect Public Health, positioning the response to climate change as the "biggest global health opportunity of the twenty first century".

It makes a compelling case that global morbidity and mortality rates are intimately linked to climate change: climate change is creating a perfect storm, with pandemics intensified by warmer weather, higher population densities and water scarcity, with the poorest and most vulnerable population often the hardest hit.

In 2003 in Europe 70,000 people died as a result of summer heat. In India at the moment temperatures have breached a staggering 48°C - putting people's lives and the country's infrastructure under tremendous strain - and leading to power cuts of up to ten hours. If we don't act we will see far more of events like this.We will see more lives lost - and infrastructure that just can't cope.

As insurers, we are particularly sensitive to the direct impacts of climate change mentioned in the report, as protecting people before and after major floods, storms, and other extreme events is a core part of our business.

However, the indirect impacts analysed in the report, from food insecurity to environmental migration to new disease patterns, are potentially much wider reaching in their economic costs, weighing increasingly on public health systems as well as private health insurers, over the long-term.

Global healthcare costs stood at USD 7.35 trillion in 2013, having doubled over the past ten years from USD 3.77 trillion in 2003. If the direct and indirect costs of climate change are integrated into future estimates, we may quickly arrive at a scenario which bears significant challenges for both public and private healthcare providers.

Risk management is the core competency of the insurance sector, and as such, we will increasingly be using our modelling and actuarial skills to better understand these connections between climate and health, as we have long-term commitments to our clients to help them to prevent and manage the health risks they may face in 10, 20, and sometimes even 30 years.

However, as risk managers, we also feel that it is our responsibility to call upon governments to take this same prudent and long-term approach to managing climate change, by adopting a holistic view of the full costs and benefits of action over time.

We believe that the Lancet Commission's ten recommendations to protect public health should be considered within the upcoming United Nations climate conference in Paris, COP21, and incorporated into the resulting commitments.

Notably, to effectively capture the opportunities related to public health, more research is needed on the potential health co-benefits of climate change mitigation. The mere continuation of consuming fossil fuels has health effects through severe indoor and local air pollution. Just take the case of drastic air pollution in major Chinese cities with significant costs for public health systems. Yet, the Blue Skies efforts during the 2008 Olympics illustrated that this could be changed swiftly in particular by switching off the most polluting coal fired power plants in the suburbs of Beijing. A step that undoubtedly does a lot of good for the climate agenda, too.

At the same time financing for climate-resilient health systems should be reinforced, and cities should develop action plans to promote healthier lifestyles, with more green spaces and clean, public transportation.

And above all, to protect public health, the Paris Conference needs to deliver an ambitious and binding agreement to limit greenhouse gas emissions, especially from the most polluting sources of energy.

As mentioned by the Lancet Commission, and from the perspective of the global insurance industry, bold action to limit the impacts of climate change - including those on health - is increasingly becoming the "no-regret option".