From the Artemis blog:
Reinsurance broker Aon Benfield has published a report which delivers a timely reminder to the insurance and reinsurance industry that the potential losses from a major space weather event could cause massive economic and insured losses and the re/insurance industry needs to consider its preparation and response. Solar storm and geomagnetic activity is forecast to peak in the coming 12 months meaning the threat of a major space weather event is approaching its highest.
Aon Benfield is covering solar and geomagnetic storms in the first in a series of publications looking at what it has termed ‘pear-shaped phenomena’, low probability events which threaten high economic consequences to the re/insurance industry and broader economy should major events occur. Unlike a black-swan event, Aon Benfield says that ‘pear-shaped phenomena’ can be anticipated and therefore the re/insurance industry should take the lead in risk management and transfer of these risks.
Scientists have said that a major space weather event could cause enormous economic losses around the globe. The next peak in solar activity is scheduled to occur later this year, it follows a roughly 11 year solar cycle from solar minimum to solar maximum when sun spot activity and solar storms are at their most violent.
The impacts according to scientists could be as large as an economic loss of $2 trillion. An economic loss of that size would naturally result in one of, if not, the largest insured and reinsured losses in history. At risk are electrical power distribution networks, telecommunications infrastructure, satellites themselves and global satellite navigation systems, all systems that if damaged would cause huge business interruption to occur for years in some cases....MORE
