This week, a Swiss technology company, IQAir, released its seventh annual World Air Quality Report. The report highlights alarming findings: in over 90% of the 138 countries monitored, the air contains harmful fine particles that exceed safe levels set by the World Health Organization (WHO). This extensive data was collected from more than 40,000 air quality monitoring stations worldwide.
The report raises important questions about the implications for insurance, particularly in health, life, and workers’ compensation sectors. Poor air quality is known to have significant health and economic impacts. A report from the World Bank estimated that in 2019, air pollution cost the global economy around $8.1 trillion, which is about 6.1% of the world’s GDP.
While IQAir does not track specific health insurance costs related to air pollution, CEO Glory Dolphin Hammes noted that there is a clear link between poor air quality and increased healthcare expenses. She pointed out that individuals from underrepresented groups often face the highest exposure to air pollution risks. This suggests that many health-related costs due to poor air quality may not yet be reflected in insurance claims.
In the United States, air pollution is estimated to cost the economy over $790 billion each year, accounting for about 5% of the GDP. Hammes emphasized that better management of air quality could lead to significant economic and health benefits for businesses. The U.S. Environmental Protection Agency estimates that every dollar spent on improving air quality can yield $30 to $90 in health and economic benefits.
The impact of air quality extends to workers’ compensation claims as well. Gary McMullen, a workplace risk director at Aon, mentioned that while air pollution can lead to claims, the numbers in Australia are still quite low. He explained that workers could potentially file claims if they develop health issues due to significant exposure to air pollution at their jobs. However, claims related to respiratory diseases have been declining in Australia, with only 0.4% of serious claims attributed to respiratory issues over the past decade.
The report also noted that Australia is one of the few countries that meet WHO air quality standards, alongside nations like New Zealand and Iceland. This raises questions about the effectiveness of air quality management in other regions and its potential impact on health and insurance costs.
As the conversation around air quality continues, it’s clear that both individuals and businesses have much to gain from improving air conditions. The connection between air quality, health, and economic productivity is undeniable, and addressing these issues may lead to a healthier population and a more robust economy.