Related papers: Physical Climate Risk in Asset Management
Driven by the increasing frequency and intensity of natural disasters and chronic climate threats, we investigate the impact of physical climate risk on global equity portfolios. By employing a panel regression analysis on sectoral returns,…
We present an open-source Python framework for modelling cascading physical climate risk in a spatial supply-chain economy. The framework integrates geospatial flood hazards with an agent-based model of firms and households, enabling…
The document discusses the financial climate risk in the context of the banking industry, emphasizing the need for a comprehensive understanding of climate change across different spatial and temporal scales. It highlights the challenges in…
Weather-related risk makes the insurance industry inevitably concerned with climate and climate change. Buildings hit by pluvial flooding is a key manifestation of this risk, giving rise to compensations of the induced physical damages and…
In empirical research, this article uses daily climate data provided by the National Oceanic and Atmospheric Administration (NOAA) of the United States to construct a temperature box with a range of 5\( ^\circ\text{C} \), focusing on…
The financial sector is increasingly concerned with the physical risks of climate change, but economic and financial impact representations are still developing, particularly for chronic risks. Mexico's Central Bank conducted a…
Climate adaptation could yield significant benefits. However, the uncertainty of which future climate scenarios will occur decreases the feasibility of proactively adapting. Climate adaptation projects could be underwritten by benefits paid…
With a changing climate, the frequency and intensity of extreme weather events are likely to increase, posing a threat to infrastructure systems' resilience. The response of infrastructure systems to localised failures depends on whether…
Assessing climate risk and its potential impacts on our cities and economies is of fundamental importance. Extreme weather events, such as hurricanes, floods, and storm surges can lead to catastrophic damages. We propose a flexible approach…
The resilience of electric power grids is threatened by natural hazards. Climate-related hazards are becoming more frequent and intense due to climate change. Statistical analyses clearly demonstrate a rise in the number of incidents (power…
We set up a structural model to study credit risk for a portfolio containing several or many credit contracts. The model is based on a jump--diffusion process for the risk factors, i.e. for the company assets. We also include correlations…
We extend the Vasi\v{c}ek loan portfolio model to a setting where liabilities fluctuate randomly and asset values may be subject to systemic jump risk. We derive the probability distribution of the percentage loss of a uniform portfolio and…
Extreme climate events, e.g., droughts, floods, heat waves, and freezes, are becoming more frequent and intense with severe global socio-economic impacts. Growing populations and economic activity leads to increased exposure to these…
There are numerous geo-climatic and human factors that contribute to the occurrence of natural disasters in the real-world scenario. Besides the study of causes and preconditions of such calamities, post-disaster analysis is essential for…
Natural disasters, such as tornadoes, floods, and wildfire pose risks to life and property, requiring the intervention of insurance corporations. One of the most visible consequences of changing climate is an increase in the intensity and…
Climate extremes such as floods, storms, and heatwaves have caused severe economic and human losses across Europe in recent decades. To support the European Union's climate resilience efforts, we propose a statistical framework for…
Insurance industry is one of the most vulnerable sectors to climate change. Assessment of future number of claims and incurred losses is critical for disaster preparedness and risk management. In this project, we study the effect of…
Weather parametric insurance relies on weather indices rather than actual loss assessments, enhancing claims efficiency, reducing moral hazard, and improving fairness. In the context of increasing climate change risks, despite growing…
This paper develops a geospatial framework for climate risk stress testing in California with applications to banking and climate-exposed sectors such as agriculture, real estate, and tourism. The study integrates physical hazard mapping,…
Flood risk is correlated in space and time, challenging insurance systems that rely on diversification across assets. Financial instruments governing flood coverage are typically structured as 1 to 5-year contracts, exposing portfolios to…