May 17, 2019

Climate Change And Insurance

Listen Later

2 minutes

While there are still some people who remain dubious about the reality of climate change, insurance companies are not among them. And, in fact, insurers are warning that climate change could make coverage for ordinary people unaffordable.

Munich Reinsurance, the world’s largest reinsurance firm, blamed

global warming for $24 billion in losses from California’s recent

wildfires. Such costs could soon be

widely felt as premium rises are already under discussion with insurance

companies having clients in vulnerable parts of the state.

With the risk from wildfires, flooding, storms and hail increasing,

the only sustainable option for the insurance industry is to adjust risk prices

accordingly. Ultimately, this may become

a social issue. Affordability of

insurance is critical because if rates go up too much, many people on low and

average incomes in some regions may no longer be able to buy insurance.

The great majority of California’s 20 worst forest fires since the

1930’s has occurred since the year 2000 driven by abnormally high summer

temperatures and persistent drought. The reinsurance giant analyzed decades of

data with climate models and concluded that the fires are likely driven by

climate change.

It isn’t just wildfires.

Insurance premiums are also being adjusted in regions facing an

increased threat from severe convective storms whose energy and severity are

driven by global warming. These include

parts of Germany, Austria, France, southwest Italy, and the U.S. Midwest.

Linking extreme weather events to climate change is a bit like

attributing the performance of a steroid-using athlete to drug use. The connections are clearer in patterns than

in individual disasters. But the pattern

these days is pretty clear.

**********

Web Links

Climate Change Could Make Insurance Unaffordable for Most People

Photo, posted June 12, 2013, courtesy of Jeff Head via Flickr.

Earth Wise is a production of WAMC Northeast Public Radio.

...more

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Earth Wise

By Randy Simon

4.7

1515 ratings

May 17, 2019

Climate Change And Insurance

Listen Later

2 minutes

While there are still some people who remain dubious about the reality of climate change, insurance companies are not among them. And, in fact, insurers are warning that climate change could make coverage for ordinary people unaffordable.

Munich Reinsurance, the world’s largest reinsurance firm, blamed

global warming for $24 billion in losses from California’s recent

wildfires. Such costs could soon be

widely felt as premium rises are already under discussion with insurance

companies having clients in vulnerable parts of the state.

With the risk from wildfires, flooding, storms and hail increasing,

the only sustainable option for the insurance industry is to adjust risk prices

accordingly. Ultimately, this may become

a social issue. Affordability of

insurance is critical because if rates go up too much, many people on low and

average incomes in some regions may no longer be able to buy insurance.

The great majority of California’s 20 worst forest fires since the

1930’s has occurred since the year 2000 driven by abnormally high summer

temperatures and persistent drought. The reinsurance giant analyzed decades of

data with climate models and concluded that the fires are likely driven by

climate change.

It isn’t just wildfires.

Insurance premiums are also being adjusted in regions facing an

increased threat from severe convective storms whose energy and severity are

driven by global warming. These include

parts of Germany, Austria, France, southwest Italy, and the U.S. Midwest.

Linking extreme weather events to climate change is a bit like

attributing the performance of a steroid-using athlete to drug use. The connections are clearer in patterns than

in individual disasters. But the pattern

these days is pretty clear.

**********

Web Links

Climate Change Could Make Insurance Unaffordable for Most People

Photo, posted June 12, 2013, courtesy of Jeff Head via Flickr.

Earth Wise is a production of WAMC Northeast Public Radio.

...more