Climate risk, a growing focus for environment, social and governance-minded investors, has morphed into an urgent issue for insurers as wildfires ravage the U.S. and Europe and natural disasters destroy property and cost lives worldwide.
In the U.S., more than 2.4 million acres have burned in more than 100 large fires and complexes in 12 states this year, according to the National Interagency Fire Center. Wildfires also are raging across Greece, Turkey, Italy, Spain, Russia and Lebanon, fueled by some of the hottest temperatures in recorded history.
A report this month from the UN Intergovernmental Panel on Climate Change found that human-produced greenhouse gas emissions are responsible for the rise in extreme weather, heat waves and drought.
On the hook for more claim payouts, the insurance industry should be doing more to prepare for climate-related risk, according to Dave Jones, California’s insurance commissioner from 2011-19. Jones is now director of the Climate Risk Initiative at the Center for Law, Energy and the Environment at the University of California, Berkeley Law School.
“The role of insurance commissioner is to protect consumers and supervise the financial stability of insurance markets,” Jones said in an interview with CQ Roll Call. Insurance is essential for consumers and businesses, but the industry faces climate-driven physical risk to covered assets as well as transition risk in their reserve portfolios, he said.
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August 19, 2021 at 06:01PM
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Climate risk becomes urgent ESG issue for insurance industry - Roll Call
"urgent" - Google News
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