Skip to main content
The Actuary: The magazine of the Institute and Faculty of Actuaries - return to the homepage Logo of The Actuary website
  • Search
  • Visit The Actuary Magazine on Facebook
  • Visit The Actuary Magazine on LinkedIn
  • Visit @TheActuaryMag on Twitter
Visit the website of the Institute and Faculty of Actuaries Logo of the Institute and Faculty of Actuaries

Main navigation

  • News
  • Features
    • General Features
    • Interviews
    • Students
    • Opinion
  • Topics
  • Knowledge
    • Business Skills
    • Careers
    • Events
    • Predictions by The Actuary
    • Whitepapers
    • Webinars
    • Podcasts
  • Jobs
  • IFoA
    • CEO Comment
    • IFoA News
    • People & Social News
    • President Comment
  • Archive
Quick links:
  • Home
  • The Actuary Issues
  • October 2016
10

Weather or not

Open-access content Monday 3rd October 2016 — updated 5.50pm, Wednesday 29th April 2020

I could not resist responding briefly to the debate on climate change risk in September’s edition

I could not resist responding briefly to the debate on climate change risk in September's edition (bit.ly/2cTz7dA), writing as an actuary who spent four full years studying climate change models.

Firstly, with regards to the unknowableness of climate changes and whether the cause of these trends is anthropogenic. To a large extent this doesn't matter. Any reasonable person would admit there is certainly some evidence that changes in the climate can happen and that this could have a material impact on our work over the next 20-30 years. There is no need to prove the point if there is enough evidence of a risk.

Secondly, to the IFoA Resource and Environment Board point that "actuaries are not currently qualified to critique the technical content of these models". It is a worthwhile debate how actuaries/anyone should inform decisions based on uncertain/inadequate models. But we deal with very complex risks all the time - climate is arguably better understood, with far more data, than cyber, terrorism or certain financial lines. Not to mention the hurricane models used in the London Market on a daily basis (which indeed form the basis of climate models). Climate really isn't that much harder than other models we deal with.

Lastly, both Geoff Dunsford's letter and the IFoA Resource and Environment Board discussed whether we should increase premiums in response to climate change. Even if it is right to increase premiums for climate risk, it may be a greater business risk to do so in a competitive environment where few other companies will follow suit. Without consensus, higher premiums are probably an unachievable luxury.

Let's not do ourselves a disservice that climate is somehow too hard for actuaries, and avoid getting bogged down in the provability of science that can already usefully inform decisions, albeit with uncertainty.


Ed Tredger, FIA, PhD 

6 September

This article appeared in our October 2016 issue of The Actuary.
Click here to view this issue
Filed in:
10

You might also like...

Share
  • Twitter
  • Facebook
  • Linked in
  • Mail
  • Print

Latest Jobs

Senior Underwriting Risk Manager

London (Central)
£85K-£95K + Benefits
Reference
124386

Reserving Manager (Contract)

London (Central)
£1200 - £1400 per day
Reference
124385

Life Actuary - Contract - IFRS 17 Financial Impact

England, London / England, Bristol / North Yorkshire, England
£900 - £1150 per day
Reference
124384
See all jobs »
 
 

Today's top reads

 
 

Sign up to our newsletter

News, jobs and updates

Sign up

Subscribe to The Actuary

Receive the print edition straight to your door

Subscribe
Spread-iPad-slantB-june.png

Topics

  • Data Science
  • Investment
  • Risk & ERM
  • Pensions
  • Environment
  • Soft skills
  • General Insurance
  • Regulation Standards
  • Health care
  • Technology
  • Reinsurance
  • Global
  • Life insurance
​
FOLLOW US
The Actuary on LinkedIn
@TheActuaryMag on Twitter
Facebook: The Actuary Magazine
CONTACT US
The Actuary
Tel: (+44) 020 7880 6200
​

IFoA

About IFoA
Become an actuary
IFoA Events
About membership

Information

Privacy Policy
Terms & Conditions
Cookie Policy
Think Green

Get in touch

Contact us
Advertise with us
Subscribe to The Actuary Magazine
Contribute

The Actuary Jobs

Actuarial job search
Pensions jobs
General insurance jobs
Solvency II jobs

© 2022 The Actuary. The Actuary is published on behalf of the Institute and Faculty of Actuaries by Redactive Publishing Limited. All rights reserved. Reproduction of any part is not allowed without written permission.

Redactive Media Group Ltd, 71-75 Shelton Street, London WC2H 9JQ