This presentation discusses economics of climate adaptation and was presented at the 5th GIB Summit on May 27-28, 2015. It outlines a methodology called Economics of Climate Adaptation to systematically assess total climate risk, identify cost-effective adaptation investments, and integrate adaptation with development. Case studies of locations like Hull, UK, New York City, and the US Gulf Coast are discussed. Public-private partnerships are highlighted as important to shape climate-resilient development. More information is available on the GIB Foundation website.

1. This presentation was held
during the 5th GIB Summit,
May 27-28 2015.
The presentation and more
information on the Global
Infrastructure Basel
Foundation are available on
www.gib-foundation.org
The next GIB Summit will take place in Basel,
May 24-25, 2016.
The information and views set out in this presenation are those of the author(s) and do not necessarily reflect the opinion of the Global
Infrastructure Basel Foundation. Neither the Global Infrastructure Basel Foundation nor any person acting on its behalf may be held responsible
for the use of the information contained therein.

2. Economics of Climate Adaptation
Dr. David N. Bresch, Global Head Sustainability, Swiss Re
david_bresch@swissre.com

3. 3
§ What is the potential natural catastrophe and climate-
related loss over the coming decade?
§ How much of that loss can we avert? How?
§ What investment will be required? Do the benefits outweigh
the costs?
§ What arrangements are needed for rare but severe events?
Reducing the disaster gap is an urgent priority
Dr. David N. Bresch | Insurance Europe | 27 May 2015

4. § Facts and methods for decision makers to design and execute a climate
adaptation strategy
§ Information to insurers and potential funders to unlock risk prevention
funding and deepen global risk transfer markets
Methodology – Economics of Climate Adaptation (ECA)
1. Rigorous risk management approach to assess the sum of:
§ today’s climate risk;
§ the economic development paths that might
put greater population and value at risk; and
§ the additional risks presented by climate change.
2. Propose and prioritize a basket of adaptation measures to address total
climate risk on an economic basis.
Objective
s
4
Total
climate risk
Dr. David N. Bresch | Insurance Europe | 27 May 2015
Climate-resilient development needs to
assess and address total climate risk

5. Guyana: Flash flood
risk to a developing urban
area
Tanzan
ia
Tanzania: Drought risk to
health and power
generation
Samoa: Risk of sea
level rise to a small
island state
Florida: Hurricane risk to
public and private assets
Mali: Risk of climate
zone shift to agriculture
India: Drought risk to
agriculture
Caribbean: Hurricane
risk to small islands
US Gulf Coast:
Hurricane risk to the
energy system
New York:
Cyclones and storm
surge risk to a
metropolis
Hull, UK: Flood and
storm risk to urban
property
Economics of Climate Adaptation (ECA) Working Group, a partnership between the Global Environment Facility, McKinsey &
Company, Swiss Re, the Rockefeller Foundation, ClimateWorks Foundation, the European Commission, and Standard Chartered
China: Drought risk
to agriculture
The working group studied more than 20
regions with diverse climate hazards

6. 6
http://media.swissre.com/documents/Economics_of_Climate_Adaption_UK_Factsheet.pdf
Annual expected loss from wind, coastal and surface flooding
High climate change scenario
USD millions
-44%
+23
+17
Potential impact
from climate
change
x1.7
96
56
Today's
expected loss
total expected
loss in 2030
Potential impact
from economic
growth
-65%
Dr. David N. Bresch | Insurance Europe | 27 May 2015
Total climate risk – city of Hull, UK, case study

7. Total asset and economic activity losses resulting from storm
and flood (zip code level) – NYC, case study
Source: www.nyc.gov: A Stronger More Resilient New York
Climate change increases sea levels and alters hurricane
frequencies
Risks are concentrated in Southern Manhattan,
Staten Island and Southern Brooklyn
7

8. 8
http://media.swissre.com/documents/Economics_of_Climate_Adaption_UK_Factsheet.pdf
Dr. David N. Bresch | Insurance Europe | 27 May 2015
Adaptation cost curve – city of Hull, UK, case study

9. 9
www.swissre.com/rethinking/Building_a_resilient_Energy_Gulf_Coast.html
http://media.swissre.com/documents/Entergy_study_exec_report_20101014.pdf
Dr. David N. Bresch | Insurance Europe | 27 May 2015
Public Private Partnerships in risk transfer –
US Gulf, risk to the energy system case study

10. § The custodians of economies need to prioritize adaptation measures to
make societies more resilient to the impacts of climate change.
§ The Economics of Climate Adaptation (ECA) methodology provides
decision makers with the facts to systematically identify cost effective
investments.
§ The ECA allows decision-makers to integrate adaptation with
economic development and sustainable growth.
§ The insurance industry's experience in risk management and
modelling and in developing insurance solutions makes it an important
partner in future adaptation plans.
Dr. David N. Bresch | Insurance Europe | 27 May 2015
http://media.swissre.com/documents/Economics_of_Climate_Adaptation_focus_infrastructure.pdf
http://media.swissre.com/documents/pub_closing_the_financial_gap_W1.pdf
10
Public Private Partnerships to shape climate-
resilient development – Conclusions

11. Further information
Dr. David N. Bresch | Insurance Europe | 27 May 2015

12. http://media.swissre.com/documents/Economics_of_Climate_Adaptation_focus_infrastructure.pdf
http://media.swissre.com/documents/pub_closing_the_financial_gap_W1.pdf
Dr. David N. Bresch | Insurance Europe | 27 May 2015 12
Publicly available documentation

13. Hull, UK: Flood and
storm risk to urban
property
http://media.swissre.com/documents/
Economics_of_Climate_Adaption_UK_Factsheet.pdf
New York: Tropical
cyclones and storm surge
risk to a metropolis
http://media.swissre.com/documents/
ECA_New_York_Gov_Factsheet.pdf
ECA full report featuring
the first 8 case studies,
164 pages
http://media.swissre.com/documents/ECA+Brochure-
Final.pdf
US Gulf Coast:
Hurricane risk to the
energy system
http://media.swissre.com/documents/
Entergy_study_exec_report_20101014.pdf
Caribbean:
Hurricane risk to
small islands
http://media.swissre.com/documents/ECA+Brochure-
Final.pdf
Guayana: Flash flood
risk to a developing
urban area
http://media.swissre.com/documents/
Economics_of_Climate_Adaption_Guyana_Factsheet_e
n.pdf
Mali: Risk of climate
zone shift to
agriculture
http://media.swissre.com/documents/
Economics_of_Climate_Adaptation_Factsheet_Mali.pdf
India: Drought risk to
agriculture
http://media.swissre.com/documents/
Economics_of_Climate_Adaptation_India_Factsheet.pdf
China: Drought risk to
agriculture
http://media.swissre.com/documents/
rethinking_shaping_climate_resilent_development_en.p
df#page=74
A global overview of
ECA studies with a
focus on infrastructure
http://media.swissre.com/documents/
Economics_of_Climate_Adaptation_focus_infrastruc
ture.pdf

14. 1) Analyze the
total climate
risk
www.swissre.com/floodriskapp
2) Adapt cost-efficiently to the
risk
Dr. David N. Bresch | Insurance Europe | 27 May 2015 14
Explore Economics of Climate Adaptation
in the Swiss Re Flood App

15. Legal notice
©2015 Swiss Re. All rights reserved. You are not permitted to create any modifications
or derivative works of this presentation or to use it for commercial or other public purposes
without the prior written permission of Swiss Re.
The information and opinions contained in the presentation are provided as at the date of
the presentation and are subject to change without notice. Although the information used
was taken from reliable sources, Swiss Re does not accept any responsibility for the accuracy
or comprehensiveness of the details given. All liability for the accuracy and completeness
thereof or for any damage or loss resulting from the use of the information contained in this
presentation is expressly excluded. Under no circumstances shall Swiss Re or its Group
companies be liable for any financial or consequential loss relating to this presentation.
Dr. David N. Bresch | Insurance Europe | 27 May 2015