Swiss Re Report Highlights New Risks from Climate Change and Plastic Pollution

Heatwaves, mold, and plastic pollution pose new risks to businesses and insurance companies, according to a new report report by reinsurer Swiss Re. These issues are interconnected, with fossil fuels exacerbating the situation.

Fossil fuels are responsible for the release of greenhouse gases that contribute to global warming and are also the primary ingredients for plastics. Swiss Re’s annual report identifies new or evolving risks that “could have a major impact on society and industry.” The potential damage from heat, heat-loving fungi, and plastic pollution could lead to significant financial and legal repercussions, the report warns.

“With a clear trend to longer, hotter heatwaves, it is important we shine a light on the true cost to human life, our economy, infrastructure, agriculture, and healthcare system,” stated Jérôme Haegeli, Swiss Re’s group chief economist, in a press release accompanying the report released last week.

“It is important we shine a light on the true cost to human life, our economy, infrastructure, agriculture, and healthcare system.”

Rising temperatures are a defining characteristic of human-caused climate change. The report notes that heatwaves are becoming more frequent and intense, with records already being set 2024 beat 2023 as the hottest year. Wildfires are increasingly becoming a threat as vegetation dries out, turning into tinder expected to be broken again soon. Additionally, heatwaves raise the risk of energy shortages and outages as demand for air conditioning surges, which in turn drives up property claims. Heat-related illnesses can also lead to increased medical, life, and workers’ compensation claims.

Heat-related deaths have been on the rise Summer blackouts have become more common in the United States since the 2000s. Heat is now recognized as the leading weather-related killer leading cause of weather-related fatalities, surpassing hurricanes, tornadoes, and other disasters. Wildfires are becoming more prevalent in the western regions of the country, leading to skyrocketing home insurance rates and prompting some insurers to pulling out of California altogether.

Conversely, some fungi species are thriving in warmer temperatures, as highlighted in the report. It predicts an increase in claims related to toxic mold in buildings located in hot, humid environments. Additionally, crops are at risk from mold proliferation in a warming climate, a situation exacerbated by an overreliance on fungicides that may contribute to the emergence of drug-resistant fungal pathogens.

Furthermore, the report emphasizes that “plastics have become a major environmental and health concern.” Some conservationists describe the ongoing influx of plastic waste into the ocean as an insidious kind of oil spill.. Researchers are still working to understand what impact microplastics have once they make it into the human body understand the full impact of plastic pollution. Tiny plastic particles have been found in our food and even in babies’ poop, leading Swiss Re to conclude that “the scale of exposures may currently be underestimated.”

Plastic pollution poses a potential risk for companies, leading to a “new wave of litigation,” according to the report. There were California lawsuits filed over plastic pollution last year, following a series of other lawsuits states have filed against fossil fuel companies for their role in the climate crisis. If future research establishes a link between microplastics and specific health conditions, it could result in new liability lawsuits, Swiss Re warns.

The report covers additional topics of concern, ranging from deepfake fraud to ultra-processed foods and the use of AI in healthcare. The primary objective of the annual report is to assist businesses in preparing for and responding to these emerging risks. However, addressing climate change and plastic pollution requires tackling their root cause—fossil fuels.