North America is identified as the region likely to be most financially impacted by the scenario, suffering a potential economic loss of $755 billion over the modelled five year period. However, the gap between the impact on North America and Europe is relatively small, with Europe calculated to take a $697 billion hit to GDP. Greater China and Asia Pacific have modelled impacts of $428 billion and $375 billion respectively
London: Lloyd’s, the world’s leading marketplace for insurance and reinsurance, has published its latest systemic risk scenario highlighting that the global economy could be exposed to losses of $2.4 trillion over a five-year period, with the expected loss of $17 billion from the threat of a hypothetical solar storm.
The global economic losses are modelled across three severity levels, ranging from $1.2 trillion in the least severe scenario to $9.1 trillion in the most extreme, equivalent to a reduction in global GDP of between 0.2% and 1.4%.
North America is identified as the region likely to be most financially impacted by the scenario, suffering a potential economic loss of $755 billion over the modelled five year period.
However, the gap between the impact on North America and Europe is relatively small, with Europe calculated to take a $697 billion hit to GDP. Greater China and Asia Pacific have modelled impacts of $428 billion and $375 billion respectively.
If this event happened today, it could cause damage to critical infrastructure such as
The insurance industry has developed a range of specialist solutions to help manage the risks associated with solar storms.
At the time of publication, Lloyd’s covers nearly a third of all global space risks, including comprehensive protection for satellites. To ensure business continuity across impacted sectors, other insurance policies available for financial safeguard include energy insurance, business interruption insurance, aviation insurance, marine insurance and agriculture insurance.
The scenario is the seventh and final scenario produced by Lloyd’s Futureset and the Cambridge Centre for Risk Studies, which aims to encourage proactive conversations and solutions to mitigating risks against the most significant risks facing society today.
Rebekah Clement, Lloyd’s Corporate Affairs Director, said: “Our research continues to highlight the need for businesses to be prepared and proactive against global risks. Historically extreme space weather has been rare, however, by equipping businesses, governments and insurers with data-based models we’re encouraging effective preparation stronger collaboration.”
Photographer and science communicator, Max Alexander, said: “The Lloyd’s Underwriting Room is synonymous with supporting the very limits of human exploration and knowledge gathering. My aim for this exhibition is to showcase not only the incredible power of the sun as the lifeblood of our solar system, but the very real risks that its power can ultimately present for our everyday lives and infrastructure.”
energy grids and satellite networks, and disrupt power, navigation, communications and financial systems which are relied upon daily by businesses, governments and populations globally.
Space photographer and commentator Max Alexander’s exhibition ‘Life in the Sun’s Atmosphere: From Disruption to Resilience’ will be unveiled as part of a flagship event held in the iconic Lloyd’s Underwriting Room in the heart of The City, with space weather experts, leading insurance industry figures, and UK Government representatives in attendance.