by Ramona Meyricke and Rafal Chomik
In Australia, the main risk to human life from climate change arises from heatwaves. As the frequency and duration of heatwaves increase, so will the number of heat-related deaths - and older people are the most vulnerable.
Other wide-ranging implications of climate change could include lower investment returns and superannuation contributions, with consequent lower retirement incomes.
This paper outlines these heat-related risks and explains why they should be considered by life insurers and annuity providers, individuals and government.
- Heatwaves, which have killed more Australians than any other natural disaster, are expected to become more frequent and last longer.
- Deaths from heatwaves could rise by 12% among over 65-year-olds by 2060-2080 in some regions.
- Climate change may have negative long-term return implications for investors.
- For individuals, it may mean lower super balances; illustrative modelling suggests reductions of 11-18% for the median earner.