Although climate scientists are now able to identify climate change as a contributing factor in extreme weather events, and predict that hurricanes will continue to get more intense, property insurance underwriters don’t take climate change into account when setting catastrophe insurance premiums. In fact, insurers don’t like to talk about climate change much at all.
CFO.com Deputy Editor David M. Katz interviews Deputy Editor David McCann about the insurance industry’s seeming foot-dragging on the climate issue. Why does underwriting assume, even thought the climate is changing, that past weather data predicts future weather patterns? Why are reinsurers a bit more forthcoming on the issue? And why does the typical 12-month term of property insurance policies present a problem?
(See the related story, Hot Topic: Climate Change and Insurance.)