Impact of Climate Change and Sustainability Standards on the Insurance Market

Kiran Sood, PhD, is a professor at Chitkara Business School, Chitkara University, Punjab, India. Before joining Chitkara University, Kiran had served four organizations with a total experience of 19 years. Her research mainly focuses on regulations, marketing and finance in insurance, insurance management, economics, and management of innovation in insurance.Simon Grima, PhD, is the deputy dean of the Faculty of Economics, Management and Accountancy, and the Head of the Department of Insurance and Risk Management of the University of Malta, Msida, Malta, which he founded in 2015. He is the chairman of the Scientific Education Committee of the Public Risk Management Organization (PRIMO) and the Federation of European Risk Managers (FERMA).Peter Young, PhD, holds the 3M Endowed Chair in International Business at the University of St. Thomas' Opus College of Business, Minn, USA. He was selected as a Distinguished Alumnus of the Year for the University of Nebraska-Omaha, was honored with the ALARM-UK Lifetime Service award, and was selected as an Honorary Fellow of the Institute of Risk Management in London.Ercan Özen, PhD, is an associate professor of finance in the Department of Banking and Finance, School of Applied Sciences, University of Usak, Turkey. He has authored 5 book chapters and more than 40 journal articles, as well as participated in many conference program committees and workshops.Balamurugan Balusamy, PhD, is an associate dean at Shiv Nadar University, India. He has written about 30 books on various technologies, as well as authored more than 150 journal and conference publications.

• Foreword xixPreface xxiiiPart I: The Impact of Digitalisation and Lines of Insurance on Sustainable Development 11 Sustainability Through Digital Insurance 3Satinder Singh, Jashandeep Singh and Shilpi Gupta1.1 Introduction 41.2 Theoretical Background 61.2.1 Origin and Concept of Digital Insurance 61.2.2 The Internet of Things 61.2.3 Digital Ecosystem for Insurers 81.2.4 Digital Disruption in the Insurance Industry 91.3 Sustainability and Digital Insurance 101.3.1 Principles for Sustainable Insurance 121.4 Digital Insurance and Sustainable Goals 121.5 Findings 141.6 Conclusion 151.7 Implications 15References 162 Motor Vehicle Insurance Industry in India: A Review 23Uma Shankar Yadav, Nikhil Yadav, Ravindra Tripathi and Kiran Sood2.1 Introduction 242.1.1 Why Do We Need Motor Vehicle Insurance? 242.1.2 Need and Significance of the Study 252.2 The Rationale for the Study of VMI in India 262.2.1 Importance of Insurance in Our Daily Life 272.2.2 VMI Industry and Effect of Pandemic (COVID-19) 272.2.3 Motor Vehicle Insurance in India 282.2.4 New Insurance Policy Rule in India 292.3 Literature Review 292.4 Objective 302.5 Methodology 302.6 Discussion 312.6.1 Motor Insurance Sales in India 312.7 Findings 342.7.1 MVA Act 2019 352.7.2 Benefits of VMI 362.8 Result 362.9 Conclusion 37References 383 Demystifying the Prospects for Insurance Companies to Finance the Energy Metamorphosis: A Study on Indian Insurance and Sustainable Development 41Mukul Bhatnagar, Letife Özdemir and Nitin Pathak3.1 Introduction 423.2 Present Status of India in Energy Transition 433.3 The Prospects for Insurance Enterprises to Finance the Energy Metamorphosis 443.4 The Reasons Why India’s Renewable Energy Investments are Anticipated to Expand 463.5 Harnessing Insurance for Sustainable Development 483.6 Conclusion 49References 504 Artificial Intelligence in the Health Insurance Sector: Sustainable or Unsustainable from the Lens of Ethical-Legal and Socio-Economic Standards 57Yogesh Mishra and Ankita Shaw4.1 Introduction 584.2 Conceptualizing Sustainable Health Insurance 604.3 Integration of Artificial Intelligence in Health Insurance: A Background 604.4 Integration of AI in Health Insurance: A Bird’s Eye View from Ethical Implications Perspective 624.4.1 Issue of Transparency 624.4.2 Issue of Accountability 634.4.3 Issue of Algorithmic Bias 634.4.4 Issue of Informed Consent 634.4.5 Issue of Safety and the Use of AI in the Insurance Sector 644.4.6 Issue of Trust Deficit Between the Insurance Providers and the Insured 644.4.7 The Issue of Explainability 654.5 Integration of AI in Health Insurance: Evaluation of Socio-Economic Repercussions 654.5.1 Economic Growth vis-à-vis Sustainability: Does Implementation of AI in Health Insurance Pose Unsustainability? 664.5.2 AI in Health Insurance: Issue of Equitability 674.6 Integration of AI in Health Insurance: Requirement of Ideal Model Legal Standards for India 684.7 Recommendations 704.8 Concluding Remarks 71References 725 Medical Crowdfunding: From the Lens of Health Insurance 75Shivani Inder and Rishu Bhardwaj5.1 Introduction 755.2 Crowdfunding in Healthcare: Medical Crowdfunding 765.3 Medical Crowdfunding: Compliment to Health Insurance 785.4 Medical Crowdfunding: Concerns and Consequences 805.5 Concluding Remarks 82References 826 Digital Transformation of the Insurance Industry – A Case of the Indian Insurance Sector 85Pawan Kumar, Sanjay Taneja, Mukul and Ercan Özen6.1 Introduction 866.2 Literature Review 906.3 Conclusion 100References 101Part II: The Impact of Climate Change on Insurance Markets 1077 Climate Resilient Agriculture: Binding Agriculture Innovations and Insurance 109Kirandeep Kaur, Jasmandeep Kaur and Ramanjeet Singh7.1 Introduction 1107.2 Agricultural Innovation and Trends 1117.3 Agricultural Innovation for Agricultural Productivity 1147.4 Agricultural Insurance and Trends 1157.5 Agricultural Insurance and Poverty Eradication 1167.6 Innovations within Agricultural Insurance 1187.7 Challenges and Difficulties Associated with Agricultural Innovation 1207.8 Barriers to Agricultural Insurance Adoption 1217.9 Future Projection of Agricultural Innovation and Insurance 1217.10 Conclusion 122References 1248 Climate Change Resilience Support in the Insurance Sector 127Reena Malik, Jyoti Verma and Ambuj Sharma8.1 Introduction 1278.2 Catastrophe Insurance and Climate Change 1288.3 Carney Defines Climate Risks 1298.4 Heading Towards Reducing Carbon Footprints 1308.5 Climate Change Adaptation and Mitigation: Paradigm Shift 1318.6 Building Resilience 1328.7 Critical Infrastructure Decarbonation and Climate Resilience Emphasis 1338.8 Combating Challenges 1358.9 Role of Stakeholders 1368.10 Role of Government 1368.11 Recommendations at Company Level 1388.12 Recommendations at Industry Level 1388.13 Mitigating Losses with Technology 1398.13.1 Satellite Imagery 1398.13.2 Location-Risk Intelligence 1398.13.3 Adjusting Claim with AR/VR 1398.13.4 Biometrics 1408.14 Conclusion 140References 1409 Sustainable Climate Change and its Impact on the Insurance Sector 143Amrinder Singh and Geetika Madaan9.1 Introduction 1449.2 Science and Politics of Climate Change 1449.3 The Implications of Climate Change for the Insurance Sector 1469.4 The Insurance Sector’s Present Attitudes Towards Climate Change 1489.5 Motivations for Thinking Differently About Climate Change 1499.5.1 Lack of Ideal Information 1509.5.2 Lack of Long-Term Business Planning 1509.5.3 Social Pressure from Peers 1519.5.4 Aspects of the Institutional Structure 1519.6 Avoiding Risks from Natural Disasters 1529.7 The Insurance Industry’s Approach to Environmental Policy 1539.8 Variation on a Global Scale 1549.9 The Role of Government in Preventing Natural Disasters 1559.10 Natural Disaster Cooperation Framework 1569.11 Added Prospects for Insurers 1589.11.1 Unparalleled Understanding of Potential Dangers 1589.11.2 New Insurance Markets 1599.11.3 Diversification 1599.12 Concluding Remarks 160References 16110 A Study Regarding the Effectiveness of Environmental Education on Climate Change 165Manju Dahiya and Naman Mishra10.1 Introduction 16610.2 Literature Review 16710.3 Theoretical Concerns 16810.4 Research Objectives 16910.4.1 Data Analysis 16910.5 Inference 17510.6 Conclusion 176References 17611 Contribution of the Insurance Sector in Sustaining the Climate: An Analytical Study 179Arti Gaur and Sweta Bhatti11.1 Introduction 18011.2 Sustainable Insurance 18111.3 Principles for Sustainable Insurance 18211.4 Role of Insurance Sector in Climate Change 18211.5 Sustainability Highlights and Initiatives Taken for Climate by SBI Life 18411.6 Energy Conservation Initiatives 18411.7 Reduction of Carbon Footprints Plays a Vital Role in Sustaining the Climate 18611.8 Enhancing Sustainability Through Insurance 18711.9 Conclusion 190References 19012 Impact of Climate Change on Agriculture 193Arti Gaur and Sanju VermaAbbreviations 19412.1 Introduction 19412.2 Agricultural Insurance – Risk Management 19612.3 Various Agriculture Insurance Programs 19712.3.1 Pradhan Mantri Fasal Bima Yojana 19712.3.2 Weather-Based Crop Insurance Plan 19912.3.3 Coconut Palm Insurance Scheme (CPIS) 20012.3.4 Unified Package Insurance Scheme (UPIS) 20012.4 Crop Insurance 20112.5 Impact of Climate Change on Agriculture 20412.6 NICRA Assisted Farmers to Cope with Climate Variation 20712.7 Conclusion 207References 20913 Climate Change: Not Only a Projection for Emerging Risks But a Reality for the Insurance Sector 211Jyoti Verma, Reena Malik and Rachit Agarwal13.1 Introduction 21213.2 Impact of Climate Change on Global Insurance Industry 21313.3 International Practice of Insurance Mechanism in Combating the Risk of Climate Change 21513.4 Conclusion 217References 21714 A Systematic Review of ESG Investing and Climate Change as a Sustainable Practice in the Insurance Industry 221Cheenu Goel, Payal Bassi and Pankaj14.1 Introduction 22214.2 Review of Literature 22314.3 Research Methodology 22414.4 Data and Network Analysis 22514.4.1 Year-Wise Publication Details 22514.4.2 Top 10 Journals 22514.4.3 Network Association of Co-Authorship with Countries 22714.4.4 Network Association of Co-Authorship with Authors 22714.4.5 Co-Occurrence of All Keywords 22814.4.6 Co-Occurrence of Index Keywords 22914.4.7 Citation Analysis – Citation of Source 23014.4.8 Author Analysis – Citation with Authors 23114.4.9 Bibliographic Coupling of Documents 23114.4.10 Bibliographic Coupling of Countries 23214.5 Conclusion 233References 23415 SLR on Aspects of Climatic Change in the Agriculture Industry in the Context of Weather Index Insurance: Visualization Through Network Diagrams 237Payal Bassi, Cheenu Goel and Pankaj15.1 Introduction 23815.2 Review of Literature 23815.3 Research Methodology 24015.4 Data and Network Analysis 24115.4.1 Publications by Year 24115.4.2 Publications by Document Type 24115.4.3 Influential Journals 24215.4.3.1 Top 10 Journals Based on Count 24215.4.3.2 Alluvial Diagram Showing the Top 10Journals Along with their Country of Origin and Impact Factor 24315.4.4 Alluvial Visualization of Top 10 Authors Based on Citations 24415.4.5 Alluvial Representation of Rank Score of Publications by Top 10 Authors 24515.4.6 Network Analysis of Co-Occurrence of All Keywords 24615.4.7 Network Analysis of Co-Citation of Cited Sources 24615.4.8 Co-Citation with Cited Authors 24715.5 Conclusion 248References 24916 Impact of Climate-Disruptive Industries on the Global Insurance and Risk Management Scenario 253Kirandeep Kaur, Kiran Sood and Simon Grima16.1 Introduction 25416.1.1 Genetic and Extractive Sector 25516.1.1.1 The Parallel Impact on Insurance Mechanism 25516.1.1.2 The Implications in Relevance to Rising Costs and Insurance-Related Risks 25616.1.2 Transportation Sector 25616.1.2.1 Accountability to Climate Change and Risk Expansion 25616.1.2.2 Exhaustive Activities Posing a Threat to the Risk-Bearing Potential of Insurance Sector 25816.1.3 Construction Sector 25816.1.3.1 A Challenge to the Resilience of the Property/Casualty Industry 25816.1.3.2 A Growing Demand for the Sector Pressurizing the Existing Insurance Model 26016.2 Objective of the Study 26016.3 Review of Literature 26016.4 Research Gap 26216.5 Findings 26316.6 Discussions and Conclusion 264References 26517 Examining the Antecedents and Consequences of Corporate Commitment Towards Climate Change 269Rajni Bala and Sandeep Singh17.1 Introduction to Climate Change 27017.2 Literature Review 27117.3 Antecedents of Climate Change 27317.4 Consequences of Climate Change 27317.5 Conclusion 274References 27518 Climate Change and the Insurance Sector: An Analysis of Sustainable Development in India 279Balpreet Singh18.1 Introduction 27918.2 Purpose 28218.3 Methodology 28218.4 Findings and Discussion 28318.5 Opportunities for Sustainable Insurance 28418.6 Conclusion 285References 286Part III: The Impact of Behaviour, Culture, Education and Internal Controls 28719 The Role of Internal Audit in Risk Management with a Perspective of Sustainability Development 289Vinita Choudhary and Sonal Trivedi19.1 Introduction 29019.1.1 Role of Internal Audit in Risk Management 29019.1.2 Purpose and Significance of the Study 29119.1.3 Problem Statement and Research Gap 29119.1.4 Structure of the Study 29219.2 Literature Review 29219.2.1 Internal Audit 29219.2.1.1 Definition and Meaning of Internal Audit 29319.2.1.2 The Role of Internal Audit in Any Organization 29419.2.1.3 The Duties and Responsibilities of an Internal Auditor 29519.2.2 Risk Management 29619.2.2.1 Definition of Risk Management 29619.2.2.2 Benefits of Risk Management 29619.2.2.3 Types of Risk in Insurance Industry 29719.2.2.4 Risk Insurance Concept 29919.2.3 Relationship Between Internal Audit and Risk Management 29919.2.4 The Insurance Industry in the Context of Climate Change 30419.3 Case Discussion 30719.3.1 Case – Internal Audit and Risk Management of General Insurance Companies in India 30719.3.2 Discussion Question in Given Case 30919.4 Contribution of Study 30919.5 Conclusion 309References 310Website 31520 Environment Education and Insurance Awareness – A Boon to Indian Insurance Sector 317Sanjeev Kumar, Kunal Raheja and Ankit Dhiraj20.1 Introduction 31820.1.1 Effect of Climate Change on India 31820.1.2 Costs to India’s Economy from Climate Change 32120.2 The History of India’s Insurance Sector 32320.2.1 Things that Changed in the History of the Indian Insurance Business were Big the Indian Insurance Scene has Slowly Changed in the Following Ways 32420.3 Insurance Plays a Vital Role 32520.4 School and University Teaching Environment Awareness 32820.4.1 Best Practices Adopted by School and University 32820.5 Different Benefits of Environment Education in Society 32820.5.1 Imagination 32820.5.2 Classroom Learning 32920.5.3 Creative Thinking Skills 32920.5.4 Learning Standards 32920.5.5 Healthy Lifestyle 32920.5.6 Communities 32920.6 Teacher and Students Empowered 32920.7 Conclusion 330References 33021 Cultivating Sustainable Behavior and Critical Consciousness Towards the Environment: Environmental Education for Sustainability 333Seema Yadav21.1 Introduction 33421.2 Environmental Education as Concept: Promoting Sustainability 33421.3 Environmental Education as an Approach for Addressing Environmental Problems 33721.4 Dealing with Complexities: Changing the Scenario with Environmental Education 33821.5 Making Students Environmental Conscious with Environmental Education 34021.6 Teachers’ Role in Achieving the Goals of Environmental Education 34121.7 What is Next? It is: Being Innovative in Environmental Education 34221.8 Conclusion 345References 34622 Adoption of ESG by the Insurance Industry: Conceptual Framework and Future Recommendations 349Kumar Shalender, Babita Singla and Sandhir Sharma22.1 Introduction 34922.2 Principles of ESG Integration in Insurance Sector 35122.3 ESG Implementation Framework 35522.4 Conclusion and Discussion 356References 35723 Sustainable Solutions for Insurance and Risk Management 359Harret Kaur, Kiran Sood, Uma Shankar Yadav and Simon Grima23.1 Introduction 36023.1.1 Objectives 36123.2 Literature Review 36123.2.1 Research Gap 36323.3 Research Methodology 36323.4 Discussion 36423.4.1 Functions of Insurance in Sustainable Development and Transfer of Risk 36423.4.2 The Contribution of the Insurance Sector Towards Sustainable Development 36523.5 Result and Conclusion 36623.5.1 Recommendations and Future Scope 36623.6 Challenges and Limitations 36823.6.1 Various Challenges Posed Due to the Adoption of Sustainable Insurance 36823.6.2 The Limitations of the Paper 368References 36924 Target 8.8: Protect Labor Rights and Promote a Safe Working Environment 373Nikita Singla, Kiran Sood, Simon Grima and Uma Shankar Yadav24.1 Introduction 37424.2 Review of Literature 37824.3 Research Methodology 38424.4 Target 8.8 38524.5 Conclusion 390References 39025 A Study on Challenges to Sustainable Development 393Baljinder Kaur and Harreet Kaur25.1 Introduction 39325.2 Aim of the Research 39425.3 Methodology 39425.4 Discussion 39525.5 Factors Influencing Sustainable Development 39725.6 Challenges in Achieving SDGs 39725.7 Conclusion 39825.8 Suggestions 399References 40026 E-waste Management: A Transition Towards a Circular Economy 403Baljinder Kaur, Kirandeep Kaur and Harreet Kaur26.1 Introduction 40326.2 Worldwide E-waste Structure 40626.3 Strategic Approaches 41126.4 DEMATEL Method 41226.5 Assessment of Life Cycle 41226.6 Challenges Related to E-waste Recycling 41326.7 Conclusion 413References 41427 Environmental, Social, and Governance (ESG) Measures and Their Impact on Insurance Industry: A Global Perspective 417Amrik Singh and Gaurav Bathla27.1 Introduction 41727.2 Literature Review 41927.3 Trends Shaping ESG in the Insurance Sector 42127.3.1 Strong Governance and Employee Engagement 42127.3.2 Advances in Technology 42227.3.3 More Accountability and Transparency 42227.3.4 Macroeconomic 42327.4 ESG Challenges in the Insurance Sector 42327.4.1 Environmental Challenge 42427.4.2 Social Challenge 42427.4.3 Governance Challenge 42527.5 Conclusion 425References 42628 Environmental Risk and Sustaining the Insurance Industry 429Gurpreet Kaur28.1 Introduction 43028.2 Review of Literature 43128.3 Literature Analysis 43228.3.1 Findings 43228.4 Conclusion 435References 43629 Global Energy Crisis: Impact on the Global Economy 439Peterson K. Ozili and Ercan Ozen29.1 Introduction 43929.2 Review of Related Studies 44229.3 Understanding the 2021-2022 Global Energy Crisis 44229.3.1 Energy Crisis in Europe 44329.3.2 Energy Crisis in Asia 44429.3.3 Energy Crisis in Africa 44429.3.4 Energy Crisis in the Middle East 44429.3.5 The Contribution of Russian-Ukraine Conflict to the Energy Crisis 44529.4 Methodology 44529.5 Empirical Results 44529.5.1 Gasoline Price: Some Data from Around the World 44529.5.1.1 Gasoline Price in Africa 44529.5.1.2 Gasoline Price in Europe 44629.5.1.3 Gasoline Price in Asia 44629.5.1.4 Gasoline Price in Middle East Countries 44829.5.1.5 Gasoline Price in the Region of the Americas 44929.5.2 Regional Correlation 44929.5.3 Granger Causality Test 45229.6 Conclusion 452References 453Index 455