Towards a green economy Region America North America

Latin America and Caribbean Europe

Western Europe

Central and Eastern Europe Asia

Japan and newly industrialised Asian economies South and East Asia

Middle East and Central Asia Oceania

Africa World

Industrialised countries Emerging markets OECD G7

EU, 27 countries NAFTA ASEAN

Table 6: World Insurance in 2008 Source: Swiss Re (2009)

Premium volume (US$ million)

1,450,749 1,345,816 104,933

1,753,200 1,656,281 96,919

933,358 675,109 229,036

29,213 77,716

54,713

4,269,737 3,756,939 512,799

3,696,073 2,925,946 1,616,461 1,364,839 45,493

Real growth

-2.4 -3.1 8.4

-6.2 -6.9 9.0 6.6 3.8

16.3 4.7 8.6

4.9

-2.0 -3.4 11.1 -3.2 -4.4 -6.7 -3.0 0.4

Share of world market (%)

33.98 31.52 2.46

41.06 38.79 2.27

21.86 15.81 5.36

0.68 1.82

1.28

100.00 87.99 12.01 86.56 68.53 37.86 31.97 1.07

Premiums as per cent of GDP (penetration)

7.29 8.54 2.53 7.46 8.33 2.79 5.95

10.41 3.20

1.45 7.02

3.57 7.07 8.81 2.72 8.32 8.96 8.28 8.10 2.99

Premiums per capita (US$) (density)

1,552.7 3,988.8 175.8

2,043.9 3,209.2 299.2 234.3

3,173.2 65.5

110.3

2,271.9 55.6

633.9

3,655.4 89.4

3,015.2 3,930.2 3,061.3 3,065.7 85.1

Box 8: Insuring against the worst for the best

Drought is a major risk in Ethiopia where 85 per cent of the population is dependent on smallholder, rain- fed agriculture. Less than 0.5 per cent have insurance. Climate change is threatening agricultural output as rainfall becomes less predictable, and many run the risk of falling into debt or having to sell assets. The use of index-based weather insurance can significantly improve lives.

Through the Horn of Africa Risk Transfer for Adaptation project, Swiss Re has been working with Oxfam America and Columbia University to protect the rural poor against drought

risk. The

project engages farmers in community-led, locally- designed climate adaptation

initiatives such as

reforestation and crop irrigation projects, where they earn premiums by making and using compost, constructing water-harvesting structures, planting nitrogen-rich trees and vetiver grasses. This unique risk management approach has allowed rural households, many led by women, to benefit from

insurance. Since its launch in 2008, uptake has increased from 200 households in the first year to 1,300 in 2010. The project now covers five villages, two climatic zones, and four crop varieties.

HSBC Insurance’s Green Insurance products in Brazil are linked to investment to preserve forests. For motor insurance, HSBC commits to preserving 88 m² of forest for five years; and for home insurance, 44 m² for the same period. The calculations are based on the environmental footprint of an automobile or residence during that period. HSBC has already invested nearly R$ 8 million (US$ 4.8

million)

preserving 3,000 hectares of Atlantic Seaboard Rainforest, equivalent to roughly 4,800 soccer fields and about 1 per cent of remaining pristine Araucaria forest. The work is carried out with the NGO, Sociedade de Pesquisa em Vida Selvagem. Funds are disbursed to landowners, each receiving a monthly sum for areas to be preserved and a forestry management plan.

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