By Ronald Richman, Old Mutual Insure Chief Actuary
As wide-scale and devastating flooding takes its toll on parts of the Western Cape and some parts of Gauteng and surrounding areas, the country is waking up to the reality of climate-change influenced damage. This damage follows the devastating wildfires in Cape Town earlier this year and point to the inescapable reality that such natural disasters are increasing in frequency and severity.
As Old Mutual Insure, our main concern in the aftermath of such catastrophic events is to ensure our policyholders have their valid claims paid. We deploy additional resources to ensure that our claims team are working around the clock to register and settle claims arising from these events as quickly as possible.
These events emphasise the urgent need for insurance protection, especially for uninsured parts of South Africa.
Frequency and severity of weather-related damage is increasing
The frequency and severity of these events is not yet beyond what one would expect during the South African summer period. However, we have observed that the volatility of weather-related events is increasing, and we attribute this to the effects of climate change.
Old Mutual Insure is in the process of developing a multi-faceted strategy to identify and quantify the effects of climate change, and to assist with mitigating these risks. This will enable us to design relevant products for our customers and to ensure our risk management programme is fully equipped to deal with climate change risks.
An industry response – immediate relief, and long-term strategies
As the world grapples with how to control emissions and prevent rising temperatures, we recognise that solving the climate change crisis is a journey.
In the interim we need immediate relief and help in communities that are struck by disasters emanating from climate change. We are playing a leading role in many communities where these events threaten livelihoods:
- Old Mutual Insure is part of a consortium of non-life insurers who have signed an agreement with the Winelands Fire Protection Association to implement an Aerial Fire Suppression Operation, which will enable a rapid first attack to put out wildfires in the Winelands region.
- We partner with organisations in areas that are affected by disasters to provide relief. For example, in response to the latest flooding in George and surrounding areas, we donated to Gift of the Givers. We also donated to the Cape Town Volunteer Wildfire Service after the Cape Town fire earlier this year.
- Climate-resilience has been included as a key focus area in our Responsible Business strategy. For example, we have embarked on a far-reaching project where we are funding boreholes in underprivileged schools to ensure constant water for consuming and for food gardens that we also sponsor. We are also engaged in a project to clear invasive alien plant species in drought-stricken areas. Lastly, we’re in the process of rolling out a project to support small and micro businesses in the waste management space.
Climate change is an existential threat to humanity and the planet, but we believe in acting to secure the planet for future generations.