Wednesday, March 18, 2009

US state insurance regulators vote to require insurers to disclose climate change risks

Solve Climate: The people who assess risk for a living are getting worried about climate change. Today, the National Association of Insurance Commissioners – the chief insurance regulators from the 50 states and U.S. territories – voted to require insurance companies to disclose the financial risks they face related to global warming.

In addition, the commissioners are requiring insurers to explain how they are preparing to deal with changing risks that could threaten their financial stability in the future, and what the companies are doing to educate state and federal lawmakers and their own policyholders about climate change. “As regulators, we are concerned about how climate change will impact the financial health of the insurance sector and the availability and affordability of insurance for consumers," explained Pennsylvania Insurance Commissioner Joel Ario, chairman of the NAIC Climate Change and Global Warming Task Force. "This disclosure standard will give regulators the information we need to better understand these risks.”

Insurers rely on intricate risk models when they write insurance policies. Those models, whether addressing risks to property, finances or health, will have to change as global warming influences some important underlying assumptions. Even scientists whose sole focus is climate say their understanding and concerns about of the speed and severity of climate change have increased substantially in just the past few months….

Sea wall construction in Galveston, Texas, between 1909 and 1915

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