U.S. Insurance Regulator Hosting Another Climate Summit – Insurance Journal
A report from the Mortgage Bankers Association says there’s little doubt that climate change will impact housing and the housing finance industry, and while just how great that impact will be is as of yet unknown, the authors take a stab at painting a scary picture of the possibilities faced by homeowners and those who service them – financiers and insurers.
The report reviews what is known about climate change, the likely impacts to housing and housing finance, strategies that can mitigate climate change or adapt and things firms in housing and housing finance can do to articulate and measure their exposure to climate change.
The report draws on numerous sources, including outlooks on flooding risks generated by and for the insurance industry, and disclosures that firms are recommended to make through the Task Force on Climate-Related Financial Disclosures. The TCFD is used as guidance by numerous insurers and insurance regulators.
“Coastal flooding provides perhaps the best example of how both physical and transitional risks are likely to impact housing,” the report states. “The National Flood Insurance Program (NFIP), the primary system of flood insurance in the United States, has numerous well-known challenges and deficiencies. Increases this century in insurance claims generated by climate change are likely to stretch the NFIP to the breaking point, facing homebuyers, lenders, GSEs and governments with a host of difficult questions. In addition, independent estimates of flood risk suggest that the NFIP currently excludes 2/3 of the at-risk properties, suggesting that the current government approach to disaster recovery.”
Washington Commissioner
Washington Insurance Commissioner Mike Kreidler is hosting his free virtual Climate Summit 2021 on Oct. 6.
Kreidler founded and has chaired the National Association of Insurance Commissioners’ Climate Risk and Resilience Working. In June, he and California Commissioner Ricardo Lara asked all insurers that are currently required to report to them annually on climate change to start reporting their climate risks in alignment with the TCFD.
The summit, according to its organizers, will highlight the latest science, and the best practices in the private sector, as well as regulatory approaches to combat climate change.
Washington state Gov. Jay Inslee is set to make keynote remarks, while Sec. Gen. Ekhosuehi Iyahen with the Insurance Development Forum will give the keynote address about addressing the insurance protection gap globally.
Experts are scheduled to speak on areas including:
This is Kreidler’s fifth climate summit. See the registration website to sign up or for more information.
Climate Litigation
Is climate litigation covered by insurance?
The question was posed by Carrier Management Executive Editor Susanne Sclafane in a recent article on Insurance Journal on Thursday.
Sclafane doesn’t stop there with questions. Another she poses is: Do liability insurance policies cover climate change litigation defendants?
She draws on a 2011 Virginia Supreme Court ruling that Steadfast Insurance Co. had no duty to defend and indemnify insured AES or claims arising from a global warming lawsuit under a commercial policy.
“Praedicat General Counsel Stephen Jones explained that AES was one of the defendants in an early climate change suit, Kivalina v. ExxonMobil, filed in 2008 by Native Alaskans whose village usually protected by sea ice had been subjected to flooding during winter storms now that the sea ice had melted,” the article states. “The U.S. Army Corps of Engineers determined that the entire village of Kivalina needed to be relocated due to the effects of climate change.”
Jones said the insurance coverage case hinged on the definition of occurrence in the commercial general liability policy, which would include an accident but not an intentional act. The court decided that because climate change harms were “a natural or probable consequence of greenhouse gas emissions,” it would not fall under the occurrence definition. Instead, it would be considered an intentional act, Jones explained.
Boris Johnson
British Prime Minister Boris Johnson told world leaders at the United Nations General Assembly in New York this week that Humanity needs to “grow up” and deal with the issue of climate change.
He slammed an inadequate response globally to climate change and urged humanity to “listen to the warnings of the scientists,” pointing to the Covid-19 pandemic as “an example of gloomy scientists being proved right,” CNN reported.
“We still cling with parts of our minds to the infantile belief that the world was made for our gratification and pleasure,” Johnson said. “And we combine this narcissism with an assumption of our own immortality.”
He added:
“We believe that someone else will clear up the mess, because that is what someone else has always done. We trash our habitats, again and again, with the inductive reasoning that we’ve gotten away with it so far, and therefore, we’ll get away with it again.”
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