As per the Swiss financial services major UBS report, titled “Climate change: A risk to the global middle class”, the climate change inflicted a USD 1.5 trillion loss on the middle-class across the globe between 1980 and 2014 and another USD 32 billion in the first six months of 2015 which was the hottest year on record.
- UBS arrived at the loss data after analysing the consumption of the middle-class in 215 cities and comparing consumption patterns to the level of climate change risks.
Key Highlights of report
- The losses are high for a vast majority living in cities, especially in South Asia, which is home to the largest number of global middle class, as most people there are not insured against natural calamities.
- A whopping 91% of weather-related losses in Asia are uninsured, against one-third of weather-related losses in the US.
- In 2000, nearly half of the global population of six billion lived in cities and the UN expects this proportion to jump to 60 per cent by 2025.
- Cities most at risk from climate change such as Los Angeles, Tokyo and Shanghai spending priorities are noticeably different, with the middle-class there spending between 0.6 and 0.8 per cent more on housing than the national average.
- A key finding of the study is low penetration of insurance against natural calamities despite increased threat.
- Emerging markets showing very low penetration relative to property value with 0.12% in China and 07% in India.
Research shows that as temperatures rise beyond 30 degree Celsius, mortality rates rise. As of 2015, nearly 25% of the 215 cities across 15 countries analyzed already had median annual temperatures above 20 degree Celsius.