The Governor of the Bank of England has warned that climate change poses a huge risk to global stability. Speaking at Lloyds of London at a gathering of leading insurance companies, Mark Carney said that climate change will lead to financial crises and falls in living standards unless countries do more to tackle it.
Mr Carney said that the challenges currently posed by climate change "pale in significance compared with what might come. The far-sighted amongst you are anticipating broader global impacts on property, migration and political stability, as well as food and water security."
He said: “Climate change is the tragedy of the horizon. We don’t need an army of actuaries to tell us that the catastrophic impacts of climate change will be felt beyond the traditional horizons of most actors – imposing a cost on future generations that the current generation has no direct incentive to fix."
Insurers are among those with the biggest interest in climate change as the syndicates operating at Lloyd's, the world's oldest insurance market, are the most exposed to disasters such as hurricanes and floods.
Mr Carney said that since the 1980s the number of registered weather-related loss events had tripled. Inflation-adjusted losses for the insurance industry had increased five-fold to $50bn (£33bn) a year.
Highlighting that France will host the climate change summit in December, Mr Carney added to the pressure for action by pointing to the threats to “financial resilience and longer-term prosperity". He added that governments must respond "while there is still time to act...the window of opportunity is finite and shrinking”.