U.S. regulators strike task force on climate change

A new task force of the National Association of Insurance Commissioners in the United States is working to increase awareness of climate change in the industry, A.M. Best reports.
Nebraska Insurance Commissioner Tim Wagner, co-head of the task force, notes the group is starting up at a time when climate change is a leading concern of insurers. “We want (insurers) to be healthy, we want them to be still engaged in the business 10 years from now,” Wagner told A.M. BestWire. “If there’s going to be a change for business, it’s better to plan for that change than not.”
Proponents of the climate change theory argue it is responsible for warming oceans, which they say is linked to an increase in the frequency and severity of hurricanes. It’s also linked to other extreme conditions, such as drought, tornadoes, brush fires and hailstorms.
But not all insurers or regulators have been converted to the line of thinking, Wagner says. “This is one of those issues that seems to polarize people,” BestWire quotes him as saying. “There are those that believe and those that don’t.”
Wagner’s hope is that the new task force not only increases awareness, but discusses land-use policies and advocating for stronger and better-enforced building codes.
So far, A.M. Best says, industry representatives appear optimistic.
“As people gain a better understanding of what climate change is and how it impacts insurance losses, that may be helpful for the regulators to better understand when companies ask for rating changes,” A.M. Best quotes Don Griffin, a spokesman for the Property Casualty Insurers Association of America, as saying. “It’s among the most serious issues the industry faces. I’m sure what companies will be doing is examining what kind of impact warming trends would have and what impact that has on their book of business. How do they change their business plan?”