By Maria Ward-Brennan
Environmental risks continues to dominate the global risks landscape according to a new report by the World Economic Forum.
The report was produced in partnership with Zurich Insurance Group and Marsh McLennan that surveyed 1,400 risk experts.
Two-thirds of the respondents (66 per cent) ranked extreme weather as the top risk most likely to present a material crisis on a global scale in 2024.
This comes after Munich Re announced yesterday that natural disasters in 2023 resulted in $250bn in losses (with insured losses of $95bn (£74.6bn) and caused more than 74,000 fatalities.
The reinsurance giant highlighted the loss statistics were characterised by the large number of severe regional storms, compared to mega-disasters in previous years.
The World Economic Forum report showed that extreme weather risks ranked the most severity risk over a 10-year period, followed by critical change to Earth systems in second and biodiversity loss and ecosystem collapse.
While environmental risks only appeared two times in this top ten, extreme weather did rank in second place. The report also noted that younger respondents tended to rank environmental risks far more highly over a two-year period compared to the older respondents.
This comes as there will undoubtedly be a spike in insurance claims in the UK after the country battled several storms recently including storm Babet, Ciaran, Debi and Henk, causing serious damage. As a result, experts have warned that extreme weather events require a new approach going forward.
The most severity risks over the two-year period was AI-generated misinformation and disinformation.
Close to three billion people are expected to head to the electoral polls across several economies including in the UK, US, Bangladesh, India, Indonesia, Mexico and Pakistan, over the next two years.
The report noted that widespread use of misinformation and disinformation, and tools to disseminate it, may undermine the legitimacy of newly elected governments. This may result in unrest that “could range from violent protests and hate crimes to civil confrontation and terrorism.”
Carolina Klint, chief commercial officer, Europe, Marsh McLennan explained: “Artificial intelligence
breakthroughs will radically disrupt the risk outlook for organisations with many struggling to react to
threats arising from misinformation, disintermediation and strategic miscalculation.”
Commenting on the report, Saadia Zahidi, managing director, World Economic Forum said: “An unstable global order characterised by polarising narratives and insecurity, the worsening impacts of extreme weather and economic uncertainty are causing accelerating risks – including misinformation and disinformation – to propagate.”
“World leaders must come together to address short-term crises as well as lay the groundwork for a more resilient, sustainable, inclusive future,” she added.
