When it comes to geopolitical risks and crisis management – and the insurance that goes with that – water problems in the Middle East and Africa could cause catastrophic global disruptions.
“Even though we hear so much about terrorism, when we look at global conflict, we as the global community spend about $1,000 billion [$1 trillion] every year to manage conflict,” he said.
In other words, yes, terrorism is a terrible peril but it is only 10% of the conflict [spend].” The pressing risk trend for insurers is unrest in Africa and the Middle East.
Widespread access to internet allowed the citizenry to see how they were treated politically, and to see how others lived, which could engender jealousy and extremism, Bentele said.
And both these regions could become more volatile if stresses and diffuclties were to arise there – as elsewhere – as a result of global warming creating water scarcity, said Dave Anderson, head of credit and political risk at Zurich.
“I think the water scarcity [global crisis risk] is the most dramatic, because it’s the hardest one to do anything about,” he said.
The whole area from northern Africa, up through the Middle East, and up to Afghanistan, millions of people are going to fall under the water scarcity problem.” As well as migration, Anderson said a scarcity of water would also lead to conflict – as vying groups would look to take control of what water is available.
“It’s potentially water as a weapon,” he explained.
It’s a disturbing development.
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