To stay sustainable: the insurance industry needs an urgent paradigm shift!

The current performance metric has outlived its utility - the way risks manifest, impact, get measured, priced, reported, regulated - all changes. With these threats come some of the biggest business opportunities.

- Praveen Gupta

Introduction
Extracting the #insurance industry out of its comfort zone the business as usual (BAU) mode and its silos - but for much of Europe remains a major challenge. The inertia percolates from top down. The International Association of Insurance Supervisors (IAIS) has 'outsourced' the climate challenge to the UNEP FI. As the climate jargon swells on a daily basis; #CO2 levels, #pollution and #biodiversity losses compound the only assured outcome is tipping point for #planetaryboundaries.

With global temperatures rising, more and more of what can be insured becomes uninsurable. As risk carriers - insurers are also investors in physical assets (predominantly but not exclusively fossil fuels) face transition risk thereby likely to become stranded assets. Dreaming of profitable growth and delighting the customer - with this backdrop - will be a mirage.

I am thankful to the General Insurance Council of India for inviting me to pen a 'short piece' on the subject, for its maiden newsletter. Sincerely hoping that the messaging howsoever simplistic - will not fall on deaf ears. That India's economy must pursue a decarbonised trajectory is a foregone conclusion. The urgency is compelling if we must attain resilience to face existential climate threats - unleashed by our actions.

Here is a stark reminder from my friend - renowned conservationist Bittu Sahgal: "My generation has left you a world with fewer choices and greater risks. But it's still a beautiful planet…".