The Institute and Faculty of Actuaries (IFoA), the international professional body for actuaries, have warned that “further formalised regulation” on climate change in the insurance sector is “increasingly likely” and that life actuaries need to be prepared in new guidance.
In the informal guidance, life insurance actuaries are told that they “should keep abreast” of “emerging regulatory standards that could affect their work”.
The guide sets out several practical steps that actuaries can take, such as using “qualitative scenarios”— for now – to begin to assess the future risks climate breakdown poses.
Actuaries are warned that it could be “problematic” to base their work “solely” on historic data or to fail to communicate the “limitations” of such an approach given the unique nature of climate risks.
The guide also details the increasing consideration of climate change by “many national and international regulatory and advisory bodies”, wi…