Why ocean health is relevant to actuaries

Every other breath we take comes from the ocean. Marine biodiversity directly supports life on Earth through oxygen production and plays a pivotal role in regulating our climate by absorbing carbon emissions and limiting rises in global temperature. Billions of people also rely on the ocean as a food source or for their livelihoods. The ‘blue economy’ includes important sectors such as fishing, tourism, biotechnology, renewable energy and transport. It accounts for $24trn of assets, making it the seventh-largest economy in the world by GDP.

However, ocean health is under severe threat from pollution, overexploitation and climate change. The environmental and social repercussions of this degradation pose a material risk to the global financial system. Awareness of these risks is low across the actuarial profession, with limited understanding of the potential repercussions for investments, insurance, banking and pensions.

Under threat

If we do not change course, we face a rapid and irreversible decline in marine biodiversity and the abundance of ocean life. This could have stark consequences for billions of people, leading to material negative effects on the global economy. Table 1 sets out the main threats to ocean health.

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Extract from the September/October issue of The Actuary, published by Institute of Faculty and Actuaries (IFoA).