Tuesday, January 07, 2003
According to an International Herald Tribune report, insurers + re-insurers who have assessed the actual + potential cost of the massive floods that occurred in Central + Eastern Europe last year (and who have also had their overall profitability threatened by the September 11th attacks) have now made the connection between climate change + a serious risk of rapidly increasing insurance pay-outs...
As a result of this factoring in of the risk of an increase in climate-related costs - which may or may not begin to afflict certain areas more frequently + severely - those who have traditionally found themselves in the path of destructive natural phenomena such as floods, hurricanes + blizzards, but have still been offered relatively cheap insurance cover, may start to find they are unable to obtain any cover at all, while those who are less directly affected may still see their insurance premiums shoot up...
Perhaps this will also mean we begin to see insurance companies rewarding behaviour, today, that currently only appears to make economically rational sense, over the longer term?
Such as the reduction of carbon emissions through increased energy efficiency, pay-as-you-drive insurance, greater uptake of renewable energy + increased recycling.
Posted 9:11 pm by Matt Prescott