Insurer Climate Risk Disclosure Survey: 2012 Findings and Recommendations

2012 was the warmest year on record in the Lower 48 states and the second most extreme weather year in U.S. history. This is not a coincidence. Extreme weather -- stronger, more damaging storms, unprecedented drought and heat in some regions and unprecedented rainfall and flooding in others -- are the predictable consequences of rising global temperatures.Eleven extreme weather events each caused at least a billion dollars in losses last year in the United States. A single event, Hurricane Sandy, caused more than $50 billion in economic losses. Insurance companies are on the hook for tens of billions of dollars in claims as a result of Sandy and other severe weather events. And American taxpayers are on the hook for tens of billions of dollars themselves, thanks to losses sustained by the National Flood Insurance Program as well as disaster relief spendingThis raises a fundamental question: Is the insurance industry prepared? Have insurers analyzed and measured their climate-related risk? Are they planning for life in a warmer world? These should be essential questions for insurance regulators in all 50 states to be asking, and some are

Major Tipping Points in the Earth’s Climate System and Consequences for the Insurance Sector

A 2°C rise in temperature from pre-industrial levels has been widely regarded as a tipping point for planet earth. Major Tipping Points in Earth's Climate System and Consequences for the Insurance Sector argues instead that sudden volatile transformations in earth's climate will occur long before this 2°C threshold is reached

Climate Change and the Insurance Sector

Climate change matters to the insurance sector. In terms of underwriting, on one scenario, the economic cost of weather losses could reach over 1 trillion USD in a single year by 2040. The impacts will be worse in developing countries. The private sector needs to work with the public sector, as part of a “triple dividend” approach that coordinates adaptation, disaster management and sustainable economic development. For asset management the indirect impacts are key. Greenhouse gas emissions have to drop by 60 per cent by 2050, which means transforming the energy economy. Finance for renewables will reach 100 billion USD a year soon. Political uncertainty is a serious blockage to market forces, and the re-evaluation of assets and project returns is happening too slowly. Finally, insurers have a duty as ubiquitous players in the economy and society to help to shape climate policies in a responsible and effective way. The Geneva Papers (2008) 33, 71–90. doi:10.1057/palgrave.gpp.2510152

Multi-level governance:opportunities and barriers in moving to a low-carbon Scotland

ABSTRACTIn view of the challenge posed by climate change and the need to reduce dependence on fossil fuels, The Royal Society of Edinburgh Inquiry (2011) examined the barriers making it difficult for Scotland to change to a low-carbon society. The single most important finding is that, whilst widely desired, change is held back by the lack of coherence and integration of policy at different levels of governance. There is activity at the level of the EU, UK Government, Scottish Government, local authorities, local communities, households and civil society, but there is often a disconnection between policies at different levels. This impedes progress and also leads to mistrust among the general public. This paper brings together the background to ten primary recommendations featured in the Inquiry addressing the principal barriers. Above all, it is important to integrate the activities within city regions and to exploit opportunities in local communities. Reflecting on the Inquiry findings, we stress the economic, social and environmental opportunities to be gained from a low-carbon society and outline the step changes that need to take place within governance, city regions and local authorities and civil society.</jats:p

National systems for managing the risks from climate extremes and disasters

This chapter assesses how countries are managing current and projected disaster risks, given knowledge of how risks are changing with observations and projections of weather and climate extremes [Table 3–2, 3.3], vulnerability and exposure [4.3], and impacts [4.4]. It focuses on the design of national systems for managing such risks, the roles played by actors involved in the system, and the functions they perform, acknowledging that complementary actions to manage risks are also taken at local and international level as described in Chapters 5 and 7. National systems are at the core of countries' capacity to meet the challenges of observed and projected trends in exposure, vulnerability, and weather and climate extremes (high agreement, robust evidence). Effective national systems comprise multiple actors from national and sub-national governments, private sector, research bodies, and civil society, including community-based organizations, playing differential but complementary roles to manage risk according to their accepted functions and capacities. These actors work in partnership across temporal, spatial, administrative, and social scales, supported by relevant scientific and traditional knowledge. Specific characteristics of national systems vary between countries and across scales depending on their socio-cultural, political, and administrative environments and development status. [6.2] The national level plays a key role in governing and managing disaster risks because national government is central to providing risk management-related public goods as it commonly maintains financial and organizational authority in planning and implementing these goods (high agreement, robust evidence). National governments are charged with the provision of public goods such as ensuring the economic and social well-being, safety, and security of their citizens from disasters, including the protection of the poorest and most vulnerable citizens. They also control budgetary allocations as well as creating legislative frameworks to guide actions by other actors.</p