New lines to help insurers reduce climate change risk

Canadian Underwriter: The Geneva Association has come up with proposed new insurance lines in four areas that would help insurers reduce risks associated with climate change, according to a research report, The insurance industry and climate change—Contribution to the global debate.

The report, which was drafted by senior insurance executives and international climate change experts, notes that actions taken to support new technologies can themselves be linked with actions to reduce risk.

Some proposed insurance contracts with incentives for prevention or sufficiency solutions include:
• Improved energy performance — incentives should be introduced to reduce drastically energy consumption in cold climates. The objective of zero energy consumption would help eliminate the risk of freezing water pipes and consequential water damage in cases of power cuts.
• Automobile insurance — a potential opportunity includes providing technical standardization advice and cheap repair methods for low-carbon vehicles through joint research centres.
• Flood liability — insured losses are often increased due to flooding and flash floods. Poorly maintained and aging infrastructure could increase the effects and create more exposure to risk. A potential opportunity would be to provide incentives to companies in charge of the operation and maintenance of rainwater run-off infrastructures.
• Food product liability — an increased number of food poisoning events is possible due to longer, hotter summers. A potential opportunity exists, therefore, to provide incentives for the use of non-carbon self-governing cooling technology such as solar-cooled refrigeration delivery vehicles...

Flood in Hungary, 2006, shot by Villy, Wikimedia Commons