The Society of Actuaries (SOA) Board authorized in 2017 a research strategy that placed increased focus on five strategic research programs. One of those programs is the Catastrophe & Climate Strategic Research Program, which will be the newest one to launch in fall 2021.
A steering committee for the program was established in October 2019 and consists of an energetic and diverse group of volunteers—actuaries from multiple practice areas and continents, meteorologists, academics and climate policy experts. The purpose of the five strategic research programs is to encourage the development of research and branding for the SOA on a cohesive theme and related topics. This program, in particular, is dedicated to furthering actuaries’ and other SOA stakeholders’ body of knowledge on climate trends and their impacts, and on catastrophic events.
Our focus with the Catastrophe & Climate Strategic Research Program has been on identifying areas of climate research that may benefit from traditional actuarial methods or address a question for insurers. We have projects underway that look at perils such as flood, wildfires, crop sustainability and climate-related impacts that affect vulnerable populations in disparate ways. We recently published research on extreme weather’s impacts on human health and how it can be attributed to climate risks.
Our recently completed climate research includes:
- Actuarial Weather Extremes
- Determining the Role of Anthropogenic Climate Change on Human Health Outcomes: A Case Study on Heat Related Illness Attribution
- Environmental Risk Series
- Catastrophe & Climate Strategic Research Program Newsletter
- COVID-19 Visualizations of Interest to Actuaries
- Social Discounting – Application to the Risk Management of Climate Change
- The Task Force on Climate-related Financial Disclosures (TCFD)
Though our initial efforts as a steering committee have been vetting and prioritizing project themes—with a focus on natural catastrophes and insurance costs or future strains caused by climate-related events—we more recently have explored the catastrophe we are in the midst of: the COVID-19 pandemic. The SOA has been actively shifting resources to address actuarial questions on this pandemic, and we are engaged in developing ideas for further SOA research. One example of research sponsored by this program is the COVID-19 Visualizations of Interest to Actuaries report.
We also have a set of volunteers in the Climate Data Analysis Group, which has studied various weather databases with the aim of assessing resolution, reporting gaps and other weaknesses, and ultimately, finding correlations to actuarial risk. We are in the conceptual stages of a project to utilize the knowledge of this group, as well as other experts with whom the SOA collaborates, to create a series of reports. This project will “unlock” the various climate and weather data sets the SOA uses and provide short open-source programs to help actuaries dig into the data.
Another important aspect of this program is climate risk education. We are partway through developing a series of environmental risk papers, and we also are planning to sponsor webinars to educate our members on climate risk and will be updating the “Climate Sources for Actuaries” report this year.
All published climate research can be found on the SOA website. More to come!
Statements of fact and opinions expressed herein are those of the individual authors and are not necessarily those of the Society of Actuaries or the respective authors’ employers.