Climate and Insurance

[rob...@rtulip.net]

I just did this very interesting interview with the top world expert on insurance and climate change, Sandy Trust of the UK Institute and Faculties of Actuaries. Sandy has co-written a major series of research reports on this problem together with the University of Exeter. In this edited video recording of our conversation, together with Metta Spencer of Project Save the World, Sandy explains the main findings about how the insurance industry can respond to the growing risks of global warming.    My interest in the conversation is how to get the insurance industry to fund research and advocacy for solar geoengineering.

 

https://projectsavetheworld.substack.com/p/episode-755-climate-and-insurance

Here is Metta's summary of the meeting.

When Metta Spencer recently sat down for a virtual trip to Edinburgh, Scotland, she was venturing into a realm rarely associated with gripping global drama: the world of actuarial science. Joined in the Project Save the World conversation by Australian climate advocate Robert Tulip and Scottish insurance expert Sandy Trust, the conversation quickly morphed from a dry discussion of policy into a chilling diagnosis of our planet’s future.

At the heart of their dialogue is a terrifying premise. The global financial and insurance systems, built to calculate and mitigate risk, are colliding with a climate reality that defies historical modeling. Trust, an actuary who has collaborated with the University of Exeter and the UK’s Institute and Faculty of Actuaries, is the co-author of a groundbreaking series of reports. These documents—sporting evocative titles like The Emperor’s New Climate Scenarios, Climate Scorpion, Planetary Solvency, and Parasol Lost—argue that our current trajectory is not just an environmental crisis, but a catastrophic failure of global risk management.

The Actuary’s Awakening

Sandy Trust’s journey into climate advocacy began roughly a decade ago when the UK actuarial profession assisted Sir David King, then the Chief Scientific Advisor to the UK government, in producing the first global climate change risk assessment. The mandate from Downing Street was blunt: if the global community, particularly massive economies like India and China, could not be convinced to act, the world was “toast.”

The solution was to reframe the climate crisis. It was no longer just a science assessment; it had to be a risk assessment.

“Risk is quite simple,” Trust explains. “It’s imagination about what could go wrong and taking action if you don’t like it. A best guess about the worst case.”

Reading that initial paper fundamentally changed Trust’s worldview. He realized the public and policymakers were operating under a dangerous illusion of safety. He points to the commonly cited “carbon budgets”—the amount of CO2 humanity can emit while keeping warming below a certain threshold. Most of these budgets only offer a 50% or 66% chance of success.

“Just reflect on that for a second,” Trust urges. “Would you get into an airplane if it had a 50% chance of getting to its destination? Would you cross a road if you had a one-third chance of getting run over? You never would.” Yet, this is the exact gamble humanity is taking with its only home.

Playing Russian Roulette with the Planet

The conversation took a darker turn when touching upon the concept of “climate sensitivity”—how much the Earth will warm if greenhouse gases in the atmosphere are doubled. Currently, the baseline assumption is that a doubling of greenhouse gases leads to a 3°C increase in global temperatures. However, Trust points out a terrifying statistical reality: there is roughly a 20% chance that the climate is much more sensitive than we think, potentially leading to a devastating 4.5°C increase or more.

“Most people wouldn’t play Russian roulette,” Trust notes, highlighting that a 20% chance of catastrophic failure is far higher than the odds of losing that deadly game. The difference between 3°C and 4.5°C is not just a matter of needing more air conditioning; it is the difference between manageable disruption and the collapse of organized human society.

Worse still, Trust argues that when factoring in other warming accelerants—deforestation, melting ice, and massive wildfires—we have, for all intents and purposes, already reached the equivalent of doubled greenhouse gases. We may already be locked into a trajectory of 3°C or even 4.5°C warming.

The Reports: A Framework for Survival

If the science is terrifying, the financial sector’s response is a glaring warning sign. Robert Tulip pointed to data from Munich Re, a massive global reinsurance company. In the 1980s, insured losses from climate-related events were in the low tens of billions globally. Today, they regularly breach the $100 billion mark and are pushing toward $200 billion.

Are the massive insurance companies panicking? Not exactly, says Trust. “Insurance companies are profit-making entities. They’re very good at managing the risk on their balance sheet... If the risk increases, they increase the premium a bit.”

The real victims are the homeowners and local economies. As risks rise, premiums skyrocket. Eventually, insurers simply withdraw from markets altogether, a phenomenon Trust calls “climate insurance ghettoization.” We are already seeing this in real-time. In places like Florida, heavily battered by hurricanes, and California, ravaged by wildfires, major insurers are refusing to write new policies. In Australia, towns like Lismore, repeatedly devastated by floods, are facing existential questions about whether they can even be rebuilt.

This creates a domino effect. If a home is uninsurable, no bank will offer a mortgage for it. If you cannot get a mortgage, the property value plummets to zero. Homeowners are left trapped—unable to afford insurance, unable to sell, and waiting for the next disaster to wipe out their life savings.

Willful Blindness and the Subprime Parallel

Metta Spencer raised a psychological question: If the data is so clear, and the financial ruin so predictable, why aren’t people demonstrating in the streets? Is there a historical precedent for an entire industry and society willfully ignoring such massive, predictable risks?

The answer, sadly, is yes. The most recent parallel is the 2007-2008 Global Financial Crisis, driven by subprime mortgages. The financial sector engaged in “irrational exuberance,” ignoring the underlying rot in their investments until the entire system collapsed.

Trust references Margaret Heffernan’s concept of “willful blindness.” Throughout history, ideas that challenge the status quo are fiercely rejected by incumbents. He points to the medical establishment’s long refusal to accept handwashing, or the decades it took to stop using fetal X-rays despite evidence they caused childhood leukemia.

In the modern era, this willful blindness is often manufactured. Trust notes how the plastics industry in the 1950s successfully shifted the burden of plastic pollution onto consumers through “Keep America Beautiful” campaigns, distracting from the systemic overproduction of plastics. The tobacco industry famously delayed action on smoking for decades. Today, the fossil fuel industry has executed a similar playbook, derailing meaningful climate action to protect their bottom lines.

Unmasking the Parasol and Approaching the Tipping Point

The most alarming revelation in the conversation centered around Trust’s latest report, Parasol Lost. It deals with a paradoxical reality: human pollution has actually been cooling the planet.

Sulfates and other aerosols released by burning fossil fuels act as a tiny sun shield, reflecting sunlight and helping clouds form. This “parasol” effect has cooled the Earth by roughly half a degree Celsius. “We’ve been geoengineering the planet already,” Trust explains, echoing climate scientist James Hansen. “We’ve just not been recognizing it as such.”

The horrific catch-22 is this: as we clean up our air pollution to save human lungs, we lose the aerosol cooling effect. We might immediately experience a massive spike in global temperatures, pushing us past critical tipping points.

One such tipping point is the AMOC (Atlantic Meridional Overturning Circulation), the massive ocean current system that includes the Gulf Stream. It brings heat from the Caribbean up to Northwest Europe, keeping countries like Britain unusually warm for their latitude. Trust warns that the AMOC is unstable and slowing down. If it collapses—which some models suggest could happen in a decade or two—the climate consequences for the Northern Hemisphere would be apocalyptic, disrupting agriculture, weather patterns, and global temperatures.

A Call for Planetary Solvency

The conversation between Spencer, Tulip, and Trust serves as a stark reminder that the climate crisis is not just about polar bears or distant glaciers; it is about the fundamental solvency of human civilization. The actuaries—the ultimate pragmatists who deal in cold, hard numbers—are looking at the math and sounding the alarm.

We are currently flying on a plane with a 50% chance of crashing, playing Russian roulette with a fully loaded cylinder, and ignoring the smoke alarms because they clash with the decor. If the insurance industry is quietly backing out of the room, it is time for the rest of us to wake up, read the data, and demand a recovery plan for the planet before our collective policy is permanently canceled.

[rob de laet]

Dear Robert,

Great conversation with Sandy, thank you. Bringing the actuaries' point of view is crucially important because they speak the language of the board rooms and operate from a risk management perspective, which also informs the finance experts of large financial institutes and companies. Risk assessment and derisking is their key focus. The failure by the climate scientist community to look at our situation from a risk perspective rather than from a purely a scientific one is a crucial mistake, and Sandy's work through the Planetary Solvency Taskforce gives this perspective real institutional weight and tells a story that does not seem to land with the powers that be if framed in a climate science way. 

As a fellow member of the Taskforce, I've been pushing Sandy on a dimension that I think deserves much more prominence in this conversation: strategic biosphere protection and regeneration as a primary climate tool, not a co-benefit, not a nice-to-have, but arguably the fastest lever we have left, possibly together with the bridge solution of SRM.

Part of what I've been trying to get across to him is that ecosystem destruction doesn't just release carbon, it makes the planet both darker (less cloud cover) and more climate sensitive at the same time. On the albedo side, healthy forests and marine phytoplankton seed low-level clouds through biogenic aerosols. Lose the ecosystems, lose the clouds, lose the reflectivity; more solar energy reaches the surface. We're already seeing this in the satellite record. On the sensitivity side, ecosystem destruction shifts the Bowen ratio away from latent heat and toward sensible heat: instead of water cycling energy upward and releasing it above the greenhouse gas layer, bare degraded land just heats up and radiates from the surface directly into the CO₂ blanket. This amplifies the warming effect of every ton of CO₂ already in the atmosphere. In other words, destroying ecosystems doesn't just add to the problem, it makes the existing problem worse.

The mainstream climate discourse suffers from 'carbon tunnel vision' and this is well understood within HPAC. Living ecosystems cool the planet through multiple pathways that carbon accounting simply cannot see: cloud nucleation via biogenic aerosols, evapotranspiration that routes heat above the greenhouse gas layer, rainfall recycling through the biotic pump, and direct surface cooling. When measured in the right unit, in watts per square meter (W/m²) biophysical cooling from ecosystem restoration is at least 3× more effective than carbon sequestration alone globally on the critical 10–20 year timescale and a much higher multiple of that in the equatorial region where 4x more sunlight comes in compared to the poles.

The effects get compounded by the Stefan-Boltzmann law means that bare degraded land, with its wild day/night temperature swings, radiates disproportionately more heat into the greenhouse gas blanket than forested land at the same mean temperature and a hell of a lot more in tropical regions because of the higher temperatures. Crucially, it acts fast: local cooling of 2–4°C can arrive within perhaps a year or two of the start of restoration projects. This is just the temperature effect, but the effect on extreme weather events is even larger: healthy biomes with healthy soils mitigate all extremes or a a friend said: the land teaches the overhead atmosphere.

Tropical rainforests sit at the heart of this. They are the Earth's cooling organs. A tropical forest moves approximately 98 W/m² of energy through the water cycle, releasing it as latent heat above most of the greenhouse gas layer. They seed clouds through biogenic aerosol production, recycle rainfall up to five or six times as moisture travels inland, and moderate surface temperatures and the flood/drought cycle in ways that benefit surrounding communities immediately. Deforestation destroys all of this simultaneously and the loss compounds silently over time in ways our models have consistently failed to capture.

The insurance industry's retreat from high-risk regions that Sandy describes is in large part the financial fingerprint of this biological collapse: unpriced, unmodelled, and accelerating. The same actuarial logic that identifies the risk should be able to price the solution: strategically restored ecosystems are the most important intervention class that addresses both sides of the energy balance, produces immediate local livability benefits, and can spread through aligned local self-interest rather than requiring perpetual top-down subsidy.

Together with SRM. the strategic restoration of the biosphere should be part and parcel of the Planetary Solvency work as headline strategy, not mere footnotes. If you like this mail, I will also forward my answer to Sandy, 

Thank you again for all you are doing, 

Warm regards,

Rob de Laet 

Project Lead Cooling the Climate

Member of the EcoRestoration Alliance

Fellow of Global Evergreening Alliance

Fellow fo the Schumacher Institute

Planetary Solvency Taskforce

Co-founder of Senang Eco Services

WhatsApp: +55 71 992617846

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[John Nissen]

Hi Rob,

I would rather highlight the weakness of the climate scientists in their scientific assessments.  Robert said:

"Reading that initial paper fundamentally changed Trust’s worldview. He realized the public and policymakers were operating under a dangerous illusion of safety." 

That illusion of safety is reinforced by underplaying the science which says that the planet is heading towards an extremely dangerous place, far from Holocene norms.  SAI is justified as a supreme risk management tool, powerful enough to nudge the planet back to a good state for the prosperity of humanity - and of biodiversity.

Cheers, John

To view this discussion visit https://groups.google.com/d/msgid/healthy-planet-action-coalition/2002735229.1535047.1774174195774%40mail.yahoo.com.

[Douglas Grandt]

Rob,

I’ll dip my oar in immediate response to the following as I understand John will be traveling with his family the next few days:

SAI alone is no match for what we are up against

Unfortunately, John’s reply below omitted “concomitant with future emissions reduction and past accumulations removal”—words to that effect—as he absolutely does not advocate for SAI alone—just as he abhors Emission Reduction Alone (ERA).

I think that you are an absolute agreement.

Cheers,

Doug Grandt 

Sent from my iPhone (audio texting)

On Mar 22, 2026, at 9:40 PM, 'rob de laet' via Healthy Planet Action Coalition (HPAC) <healthy-planet-...@googlegroups.com> wrote:



Hi John, 

Understand your point of view and agree up to a point, but it does get clearer immediately from a risk management perspective. I have heard scientists say things like: ''we need to research this for another decade to get a clearer picture''. We don't have that time.  SAI alone is no match for what we are up against. IMHO we need to fire on all cylinders at the same time: energy transition, decarbonization, strategic biosphere regeneration and test techniques like SAI/SRM and OPR at enough scale to see what the effects and side effects are,

Best,

To view this discussion visit https://groups.google.com/d/msgid/healthy-planet-action-coalition/1527615802.1691834.1774229902513%40mail.yahoo.com.

[Douglas Grandt]

Rob et al,

John’s PRAG submission (2 attached pdf files) to EU Arctic policy update clearly explains PRAG’s position on SAI along with decarbonization and removal, etc.

Doug 

From: Douglas Grandt <answer...@mac.com>
Date: March 16, 2026 at 6:11:06 PM EDT
To: John Nissen <johnnis...@gmail.com>
Cc: Planetary Restoration <planetary-...@googlegroups.com>, Peter Wadhams <peter....@gmail.com>, Herb Simmens <hsim...@gmail.com>, Gregory Slater <ten...@gmail.com>
Subject: Re: [prag] [HPAC] PRAG meeting to discuss a group submission on EU Arctic policy: Monday 9th March, 9 pm UK time



John et al,

PRAG submittal 

[John Nissen]

Hi Rob,

Yes, SAI alone is not enough. But it is absolutely necessary in the short term.  I claim, from doing the maths, that only SAI has the cooling power to start bringing down the Arctic temperature, as absolutely necessary to prevent the several tipping processes from proceeding beyond the point of no return, which would be catastrophic.  Other procedures may be necessary in addition, but only SAI can do enough of the basic cooling.

The PRAG 50-year plan involves: refreezing the Arctic; bringing down the global temperature to 0.5C or below; and removing a trillion tons or more of CO2 from the atmosphere, which together with methane suppression, could reduce CO2e to 380 ppm or below.  These suggested targets correspond to conditions around 1980, when the exponential melt of Arctic sea ice started.  This was arguably when the Earth System started accelerating away from Holocene norms of temperature and ice cover.

Cheers, John

[rob de laet]

Hi John, 

Understand your point of view and agree up to a point, but it does get clearer immediately from a risk management perspective. I have heard scientists say things like: ''we need to research this for another decade to get a clearer picture''. We don't have that time.  SAI alone is no match for what we are up against. IMHO we need to fire on all cylinders at the same time: energy transition, decarbonization, strategic biosphere regeneration and test techniques like SAI/SRM and OPR at enough scale to see what the effects and side effects are,

Best,

Rob de Laet 

Project Lead Cooling the Climate

Member of the EcoRestoration Alliance

Fellow of Global Evergreening Alliance

Fellow fo the Schumacher Institute

Planetary Solvency Taskforce

Co-founder of Senang Eco Services

WhatsApp: +55 71 992617846

On Monday, 23 March 2026 at 00:04:52 CET, John Nissen <johnnis...@gmail.com> wrote:

[John Dixon]

Hi Rob

I could not agree more with your sentence that we need to "fire on all cylinders at the same time". There is far too much emphasis on one or another technology and one or another silo. Moreover, advocates for specific solutions focused on one or another technology generally overlook the substantial potential synergies between the silos. 

Cheers

John

Sent from Android device

To view this discussion visit https://groups.google.com/d/msgid/healthy-planet-action-coalition/1527615802.1691834.1774229902513%40mail.yahoo.com.

[Brian Cady]

Folks, if you are interested in specifically how to fund 'firing on all cylinders', I would like to hear your thoughts regarding CRIGC.org; The Climatesafe Re-Insurance and Government Consortium. I see the success of UL.com regarding fire safety as a quasi-model for what the insurance industry might accomplish regarding climate safety  - hence https://CRIGC.org.

I am interested in both critiques and in alliances and teamwork,

Brian

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To view this discussion visit https://groups.google.com/d/msgid/healthy-planet-action-coalition/1B13A5C9-FBAB-4156-B920-ADCBAB586AFC%40mac.com.

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For more from Brian, please see:
http://hopefulvision.blogspot.com

[rob de laet]

Hi John, 

we agree that all is necessary, but I still think that the NBS are totally underestimated, while we have clear calculations and evidence. I think it would be good to make a sort of a table that offers cooling nrs and timeline per intervention, both at surface level and TOA in w/m2. 

To view this discussion visit https://groups.google.com/d/msgid/healthy-planet-action-coalition/CACS_FxoUdoEEpy4jXkN-_fWQCc1goa6ETYSHRzWzHrg12AVGgA%40mail.gmail.com.