Increasing frequency and severity of climate-related disasters could force more insurers to withdraw home insurance from vulnerable areas, according to research from the United Nations.
In its latest Interconnected Risks report, the UN outlines a series of "risk tipping points", including the moment when property insurance becomes unattainable or unaffordable.
A risk tipping point is reached, the report explains, when systems we rely on for our lives and societies cannot buffer risks and stop functioning as they are expected to.
Insurance was one example, with places afflicted by increasingly extreme weather events seeing soaring insurance costs, while population growth means development continues in risky areas.
In parts of California, for instance, some major insurers are ceasing coverage due to wildfire risks; premiums have soared in Florida, contributing to the bankruptcy of six insurance firms; while in Australia over half a million homes are predicted to become uninsurable by 2030 due to flood risks.
Other tipping points included heat becoming unbearable, depletion of groundwater, growing space debris and mountain glacier melting.
The report emphasises the urgency to act before reaching these tipping points. The report calls for a multi-pronged approach involving homeowners, municipalities, and global actions to mitigate these risks.
A new framework is proposed to classify and discuss the effectiveness of solutions to help address risk, with solutions falling into two broad categories, of avoidance and adaptation.
“Real transformative change involves everyone,” said Zita Sebesvari, at the UN University’s Institute for Environment and Human Security.
In the case of insurance, for example, she said owners can increase flood resilience, municipalities can improve planning, governments can offer state-backed insurance and global action from countries and companies can cut carbon emissions.