Insurance Industry Is Taking Climate Change Seriously

Now that it’s paying an average of $50 billion a year in weather- and climate-related losses, the insurance industry has become a believer in global warming.

A new study of 1,148 mitigation and adaptation programs in 51 countries — activities that cost a total of $2 trillion — shows that insurance companies have become strong supporters of reducing carbon emissions and minimizing the risks posed by extreme weather.

“Climate change stands as a stress test for insurance, the world’s largest industry with U.S. $4.6 trillion in revenues, 7% of the global economy,” writes Evan Mills, a scientist at the Lawrence Berkeley National Laboratory at UC Berkeley. Mills’ study found that property damage and business disruption claims have been doubling every decade since the 1980s.

— Posted by Alexander Reed Kelly.

Los Angeles Times:

Superstorm Sandy, which ravaged the Eastern Seaboard, is just one recent example of the kinds of increasing liability posed by severe weather events in a changing climate, Evans said.

Insurance industry representatives from the United States, Europe and Asia have been working with scientists on the Intergovernmental Panel on Climate Change since the 1990s to better understand their exposure to risks associated with rising global temperatures, Evans said.

Members of the industry have taken a lead role in raising public awareness of global warming, supporting climate research, and mounting efforts to reduce greenhouse gas emissions by making their own operations more energy efficient, and through their investments in managing a $25 trillion portfolio, he said.

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