Insuring new climate risks that affect health
Abstract
This joint interview highlights the growing challenges insurers face in understanding and covering all the risks associated with climate change and their impact on health. The many risks that have appeared recently are interconnected and combine with existing threats, making them particularly complex to manage. It is in this context that AXA is striving to find innovative solutions to offer protection to as many people as possible, thereby increasing society's overall resilience.
Understanding and managing risk is in the DNA of an insurer. AXA is committed to deciphering emerging risks and new impacts on humankind, drawing on its internal resources and supporting science at a very early stage in laboratories so that it can make sense of the complexity of the world around us. For 16 years, the AXA Research Fund has been accelerating the exploratory capacity of science by supporting researchers through grants. By promoting open, cross-disciplinary and independent science, it enables exploration in new areas of risk science relating to health, the climate, and the economy. This support for the academic world is part of a broader approach – a major focus for AXA – involving alliances between private and public players to tackle the major challenges facing society, particularly climate change and its impact on human health. In this context, insurers play an increasingly crucial role in the economy and the protection of individuals and the environment, driving resilience and innovation for a more sustainable future.
Outline
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As an insurer, how does AXA approach the risks associated with climate change and their interconnections with health risks?
1F.G. Our risks are clearly evolving and becoming increasingly interconnected.
- 1 AXA. (2024). Future risks report 2024: The annual review of the major risks ahead.
- 2 Potsdam Institute for Climate Impact Research (2023). 38 trillion dollars in damages each year: Wor (...)
2The climate changes we are seeing, for example, have close links with the geopolitical risks and health issues that our policyholders are facing or will face in the future. In our latest Future Risks Report, climate change and infectious diseases once again feature in the top 10 risks identified.1 Our report highlights the importance of acting now to better understand and manage these risks and their correlations. The impacts of climate change are already palpable: water deficits were responsible for a 10% increase in migratory flows between 1970 and 2000, while unpredictable rainfall increases the risk of flash floods. This need to act is also reflected in investments. According to the Potsdam Institute, every dollar invested today in environmental transition could avoid six dollars in future costs.2 However, expenditures on health, welfare and pensions for an ageing population limit targeted investments in the ecological transition. To achieve a better understanding of these links and anticipate both their impacts and our ability to respond and support our customers, we are working with the scientific world and various experts to advance research focused on improving our understanding of health issues.
3We remain humble in recognizing that these risks are highly complex and constantly evolving. We acknowledge that we do not always fully grasp their connections and cross-impacts, necessitating a review of how we understand and quantify them. By forging closer ties with academic partners, insurers, public authorities and the healthcare sector, we are seeking not only to drive progress for AXA but also to foster collective intelligence and a shared understanding of the current state of the world.
- 3 Stress tests under different ecological transition scenarios aimed at measuring the vulnerability o (...)
4At the same time, we are testing numerous scenarios to measure our company's resilience in the face of past or foreseeable situations. In 2023, we took part in the second climate stress test organized by the Autorité de Contrôle Prudentiel et de Résolution (ACPR),3 France’s insurance sector regulator. This initiative was another opportunity to enhance our in-house expertise in assessing the risks associated with climate change and their impact on health.
5Our ongoing focus on controlling our risks enables us to provide cover for our customers while offering us a unique opportunity to deepen our understanding of risks, their interconnections and how we can provide a relevant response before and after a loss occurs.
The consequences of climate change for health are wide-ranging in terms of their nature and impact. Do you pay particular attention to certain risks, geographical areas or categories of policyholder?
6F.G. We conduct business in over 50 countries worldwide, with a significant presence in Europe. Our customers include individuals and businesses. We strive to provide innovative solutions, tailoring our responses to the diverse needs of our various categories of policyholders.
7The consequences of climate change are vast. Day-in day-out, we are making significant efforts to improve our understanding of these consequences by calling on scientific experts, the academic world and our in-house experts, and by forging valuable partnerships.
- 4 AXA Climate. https://climate.axa/.
8Internally, for example, AXA Climate4 is helping us improve our understanding of the consequences of climatic events and their impact on society, and deliver prevention and protection solutions that are increasingly tailored to our customers and the wider public through public-private partnerships. Finally, AXA Essenti'All also helps us provide inclusive insurance solutions that will help people in cases where our traditional solutions are not suitable.
You mentioned the notion of inclusive insurance. What are you doing more broadly to strengthen society's resilience and promote a certain universality of protection in a context of increasing complexity and heightened risks?
9F.G. Improving society's resilience means improving understanding, prevention, coverage and protection for all its stakeholders, both individuals and companies.
10When we look at how to make our products and services more inclusive, what we are actually doing is aiming to improve the way we meet populations' needs. And the way we do it is by focusing on their fundamental needs to create products that are not only more financially accessible, but also provide the financial and material support before and after a claim that ensures we can better respond to the challenges people face.
11The reason why some people decide not to take out insurance is usually a lack of financial means or awareness. In this case, simplifying and tailoring our products means reducing financial obstacles while also taking a more targeted approach to our distribution channels. In China, for example, the authorities of a large city developed a compulsory health insurance scheme for all residents, making the solution more accessible by pooling risks and thus preventing adverse selection.
12The strength of the AXA group still lies in our ability to offer a range of products and services tailored to a vast array of needs.
13In addition to universality, prevention also significantly helps strengthen society’s resilience. AXA has been investing in this area for a long time, providing a different response that is fair for policyholders and insurers while reducing the potential occurrence or severity of the events covered. We also need to innovate and develop a wide range of expertise, whether in our property insurance products and the prevention of physical phenomena (e.g., floods and fire) or in our healthcare products, designed to provide our customers with dedicated services that facilitate access to treatment and improve lifestyle over the long term.
You mentioned the importance of collaboration between stakeholders. How do you collaborate with public and/or private stakeholders to help moving forward on these issues?
14F.G. Faced with a subject as complex as climate change, we acknwoledge that we cannot alone tackle related phenonema. We therefore work alongside public organizations.
15Public authorities play a major role in ecological transition and in preventing the risks associated with climate change by, for example, restricting development in areas highly exposed to natural hazards. We provide them with our expertise to improve all parties’ understanding of these risks, and propose a joint response covering regulation, preventive action and hybrid solutions combining state and private insurance so that we can offer an adequate level of cover.
16We have regular discussions with governments, regulators and private partners to challenge and fine-tune our approach.
Why did a major insurer like AXA decide to set up a corporate philanthropy fund specifically to support research?
17J.A. AXA took the decision to support science because it sits at the heart of our core business. AXA's mission is to protect the real economy. The multiple risks we face are constantly evolving, making necessary to look ahead: when it comes to the risks we will have to adapt our businesses to, what will they look like in five, ten and fifteen years' time? To meet these challenges, AXA has a long tradition, particularly in Françoise's teams, of understanding and deciphering current and emerging risks, because a risk we understand is a risk we can insure against. This strong belief in science and the central role it plays in our strategy underpin the AXA Research Fund’s mission. Since 2008, our fund has supported research projects in health, socio-economy, climate, and environment.
- 5 The AXA Research Fund Scientific Committee is made up of eight internationally renowned researchers
18We are a patron of science with a clear philosophy. As an entirely philanthropic organization, our independent Scientific Committee looks first and foremost for scientific excellence and transformative potential of projects. We support an open, independent, cross-disciplinary – and therefore pioneer – science. We partner with researchers of the highest international level as well as promising young post-doctoral researchers from all over the world thanks to a very strict selection process based on academic standards.5
- 6 J. Boitel (October 1, 2024). According to Davos, misinformation is a major global risk, Les Echos. (...)
19Secondly, we believe in making science accessible to everyone. We encourage the researchers we support to ensure their published work is freely available and share it broadly. At its core, the Research Fund echoes our conviction that scientific research contributes to progress and human well-being. It is one of the tangible elements that enables AXA to say that the science of risk is at the heart of our strategy. Faced with the explosion of misinformation, identified as one of the greatest risks to humanity by the World Economic Forum6 in 2024, we are convinced that supporting researchers, re-explaining how science is made, and basing our decisions on scientific facts is absolutely key.
20During Axa Research Fund's first 16 years, we have allocated 256 million euros to financing over 720 projects in more than 40 countries.
How does the AXA Research Fund address the impacts of climate change on human health?
21J.A. We constantly have our fingers on the pulse of the world of science, society and business concerns. The impact of climate change on health emerged as a weak signal a few years ago. We are exploring areas where business is not yet active, which means that we can position ourselves as forerunners. For example, the AXA Chair in Wildfires and Climate at the Technical
- 7 AXA ResearchFundLive (April 10, 2024). MasterScience: “The Battle Against Megafires” with Prof. Apo (...)
- 8 Ibid.
22University of Crete in Heraklion, Greece, existed well before the recent events in Australia and Canada. And forest fires are definitely a public health issue! Worldwide, it is estimated that nearly 500,000 deaths each year are due to pollutants emitted by fires,7 similar to the number of deaths attributed to AIDS or malaria. Some of the worst episodes of air pollution in the world are currently associated with wildfires. In Southeast Asia, around half the days of the year during periods of severe El Niño events are marked by poor air quality, with concentrations of fine particles (PM2.5) exceeding the provisional WHO targets. Studies have also shown that exposure to heavy smoke during wildfires increases the risk of cardiac arrest by up to 70%.8 Even more disturbing is the fact that wildfires can affect the health of human beings even before they are born by reducing the birth weight of newborns.
- 9 Harish, V. et al. (2024). Human movement and environmental barriers shape the emergence of dengue. (...)
23We were also the first to support a global observatory on communicable diseases at the London School of Hygiene & Tropical Medicine. Today, dengue fever – I managed many emergencies related to this particular disease in the Medical Assistance Department – is moving from South to North because of climate change. Since 1940, four billion people in 120 countries9 have been exposed to dengue, but we lack global databases. The observatory, developed with our support, will make it possible to anticipate dengue epidemics by up to three months in advance and counter the associated risks through concrete measures such as raising public awareness, removing mosquitoes from towns, and ensuring health systems can work on preventing new epidemics.
24We also fund projects on many other related topics, such as eco-anxiety, urban adaptation and the social impacts of climate change, because we understand the importance of pre-empting these issues, particularly as an insurer. For example, we often hear about a lack of water or too much water during floods, but climate change is also affecting water quality. This is the topic of an AXA Research Chair at Vrije Universiteit Brussel in Belgium. The aim is to collate crucial monitoring data, which is currently lacking, in order to provide water management authorities with relevant information and limit health risks.
As well as funding research, what other actions is the Research Fund taking to improve knowledge and develop practical solutions to these issues?
- 10 MasterScience, AXA Research Fund. https://axa-research.org/masterscience.
- 11 AXA (March 13, 2024). The Geneva Health Forum and the AXA Research Fund are launching the €50,000 G (...)
25J.A. Our second mission is to support knowledge-sharing. We train young researchers to speak to the media and use social media so that they can promote their research to a non-scientific audience. We also produce publications, masterclasses freely accessible on YouTube (such as the MasterScience series)10 and other educational content aimed at promoting important scientific knowledge on major societal issues. Finally, we create opportunities for discussions with decision-makers and stakeholders from public and private sectors on the knowledge and management of major risks. We recently partnered with the Geneva Health Forum11 to launch an award on the impact of pollution on human health. The University of Lausanne, which won the prize, is working on the emission of forever pollutants from urban waste management. Our aim with all these actions is to promote research on targeted subjects that have a major impact on society and the planet.
26These initiatives reflect our philosophy of promoting science coalitions. I believe that we all have the same questions and by joining forces we will deliver more robust answers. For example, we have joined the UNESCO Foundations Dialogue and signed the Monaco Declaration 2023, an international coalition on oceans. It is crucial to protect the oceans because they play an essential role in the health of humans, animals and the planet. With the Research Fund and this coalition, we are encouraging all our in-house teams to take an interest in this subject and understand what it means to us. We want to raise awareness on the link between the health of the oceans and the health of life on earth. One of our key strengths is bridging the gap between research and our activities, and I am conviced that AXA can become a leader in the scientific coalition.
To what extent does the Research Fund's work influence AXA's decisions and actions on these issues?
27J.A. The link between the research we support and AXA's core business is a key issue, all the more so for me as I come from the world of medicine and health crisis management. By bringing science out of laboratories and connecting it with the private sector, the whole of society benefits. This is why we encourage discussions with researchers, ensuring our managers and employees at AXA are better informed. We create direct links with supported researchers, universities and AXA through Learning Expeditions. Researchers come to AXA offices and AXA employees also visit the universities where the research is being conducted. Over the past six months, 1,500 AXA employees, including senior managers and employees involved in climate issues, have been in direct contact with researchers.
- 12 The Conversation, Axa Research Fund. https://theconversation.com/fr/topics/axa-research-fund-franca (...)
- 13 Elena Sender, Alexis Barbier-Bouvet, Arte documentary (August 2024). Grands vents – Sirocco, le sou (...)
28As mentioned above, we work on different ways of sharing this knowledge. We have media partnerships with The Conversation, a platform offering news analyses written by researchers.12 A major advantage is that all the articles are free of copyright, which means our researchers can publish their work in national and international journals with a large readership. We are proud to see the researchers we fund sharing their expertise and raising awareness among a wide audience. Recently, Professor Carlos Perez Garcia, holder of the AXA Chair at the Barcelona Supercomputing Center, was featured in an Arte report on the Sirocco, highlighting his work on real-time modelling of dust storms and their movements. Thanks to his research, he can predict where these particles will settle within three days, information of crucial importance for people and their health.13
One final question: what are the main challenges facing the insurance sector in the years ahead?
29F.G. Our annual Future Risks Report enables us to gauge how our experts perceive the major challenges ahead, and to understand the key trends that will influence the insurance sector over the next few years.
30Firstly, since risks are increasingly interconnected, insurers will seek to better understand them so they can assess impacts, anticipate, and diversify their portfolios across different categories of risks. This will allow them to manage risks sustainably while avoiding any potential overexposure to a specific region or type of risk. We also believe that protection deficits will rise, partly because public authorities will find it increasingly difficult to cover the needs of the entire population through social security mechanisms. Prevention should therefore become an essential adjunct to insurance, making it even more important to implement joint public and private mechanisms to meet the needs of society as a whole.
31Demographic changes around the world, marked by both an ageing population, particularly in very mature markets, and a much younger population in emerging countries, more exposed to climate change, will also reshape customer needs.
32Finally, technology, data and generative AI will have a profound impact on our operations, distribution and customer relationships, with the potential to significantly alter the competitive dynamics within the sector. These developments confirm the starting point of this interview: in an increasingly complex world, providing protection for individuals is becoming more and more essential.
33J.A. The trend I’m seeing in philanthropy is to fund increasingly complex research with impacts that may even result in the creation of start-ups and spinoffs, thus extending into the real economy. There is also more research on systemic risks, i.e., risks that will lead to chain reactions throughout the system, potentially causing a general crisis in its functioning; two examples are cyberattacks and solar flares, which are still underestimated. For insurers, these risks can spread across various sectors and product lines, more complex to manage, as observed during the COVID crisis.
34The Research Fund’s mission is increasingly important: we need to share knowledge and encourage decision-making based on science, whether internally at AXA or externally with our customers, partners, and civil society. In the current climate of uncertainty and political tension, we must emphasize the extremely positive role of science and explain how it is done. Creating and disseminating scientific knowledge aids decision-makers and experts, who can then create coherent strategies with products adapted to future challenges based on precise knowledge of the issues we face.
Notes
1 AXA. (2024). Future risks report 2024: The annual review of the major risks ahead.
2 Potsdam Institute for Climate Impact Research (2023). 38 trillion dollars in damages each year: World economy already committed to income reduction of 19% due to climate change. https://www.pik-potsdam.de/en/news/latest-news/38-trillion-dollars-in-damages-each-year-world-economy-already-committed-to-income-reduction-of-19-due-to-climate-change.
3 Stress tests under different ecological transition scenarios aimed at measuring the vulnerability of the financial sector (banking and insurance) to the physical and transitional risks associated with climate change.
4 AXA Climate. https://climate.axa/.
5 The AXA Research Fund Scientific Committee is made up of eight internationally renowned researchers.
6 J. Boitel (October 1, 2024). According to Davos, misinformation is a major global risk, Les Echos. https://www.lesechos.fr/monde/enjeux-internationaux/la-desinformation-risque-mondial-majeur-selon-davos-2045484.
7 AXA ResearchFundLive (April 10, 2024). MasterScience: “The Battle Against Megafires” with Prof. Apostolos Voulgarakis, AXA Research Fund, YouTube video. https://www.youtube.com/watch?v=xMJCzVyo5AM.
8 Ibid.
9 Harish, V. et al. (2024). Human movement and environmental barriers shape the emergence of dengue. Nature Communications, 15(1). https://doi.org/10.1038/s41467-024-48465-0.
10 MasterScience, AXA Research Fund. https://axa-research.org/masterscience.
11 AXA (March 13, 2024). The Geneva Health Forum and the AXA Research Fund are launching the €50,000 Grand Jet d'Or de Genève prize to tackle the impact of pollution on human health. https://axa-research.org/news/the-axa-research-fund-and-geneva-health-forum-launch-50000eur-grand-jet-dor-de-geneve-award-to-address-pollutions-impact-on-human-health.
12 The Conversation, Axa Research Fund. https://theconversation.com/fr/topics/axa-research-fund-francais-48666.
13 Elena Sender, Alexis Barbier-Bouvet, Arte documentary (August 2024). Grands vents – Sirocco, le souffle du desert [High Winds – Sirocco, the breath of the desert].
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References
Bibliographical reference
Françoise Gilles and Julia d’Astorg, “Insuring new climate risks that affect health”, Field Actions Science Reports, Special Issue 27 | 2025, 118-122.
Electronic reference
Françoise Gilles and Julia d’Astorg, “Insuring new climate risks that affect health”, Field Actions Science Reports [Online], Special Issue 27 | 2025, Online since 15 December 2024, connection on 13 February 2025. URL: http://journals.openedition.org/factsreports/7832
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