Losses from extreme weather could top $1 trillion in a single year by 2040, the United Nations Environment Programme and private finance institutions (UNEP FI) warned today.
Speaking at a UN climate meeting in Kenya, they said the estimated cost of droughts, storm surges, hurricanes and floods reached a record $210 billion in 2005, and that such losses linked to global warming were seen doubling every 12 years.
"In one scenario, potential disaster losses are calculated at more than $1 trillion in a single year by 2040. . . . It is one of many scenarios, but the process was robust and the institutions felt comfortable it was a realistic scenario," Paul Clements-Hunt of UNEP FI said.
The new report was modelled for UNEP FI's Climate Change Working Group, whose members include Dresdner Bank, Bank of America, Swiss Re, UBS and HSBC.
The study said it seemed likely there would be a "peak year" of losses of more than $1 trillion before 2040.
"Since so much development is taking place in coastal zones the figure may arrive considerably before 2040," it said.