Modern society depends on interconnected food systems that are global in reach and designed to harness a multiplicity of complex supply chains. These systems have delivered significant benefits, but they also face major threats to their sustainability.
Following our report on the issue of global food security (Feast or Famine, Lloyd's, 2013), Lloyd's commissioned the development of a scenario for plausible shock events in order to explore the implications for insurance and risk. Experts in the fields of food security and the economics of sustainable development were asked to develop a plausible scenario of a global production shock to some of the world's staple food crops, and to describe the cascade of impacts that could result.
This report presents one plausible scenario and the findings of the workshops. It aims to reveal some of the complex risk factors that exist in the modern food system, and to present initial findings on the role that insurance could play in managing those risks.