Insurance Journal: IPCC Climate Change Report

The UN Intercontinental Panel on Climate Change has issued a report on the ongoing risks of droughts, floods, wildfires and storms due to climate change. Corporations already prepare, and the insurance industry must worry both about property damage and coverage as well as an abrupt end to investments in the carbon economy as public opinion tends to shift quickly on such matters. “Institutional investors, such as insurers, could face transitional risks, where governments and citizens, fearing potential catastrophic impacts of climate change, respond aggressively to decarbonize the economy, and assets in fossil fuels become stranded investments as the sector plunges on the markets,” reports Don Jergler for Insurance Journal. Reducing reliance on coal and other fossil fuels could limit global warming increase to 1.5˚C. The California Insurance Commissioner organized a database of oil, gas, utilities and coal investments held by insurance companies and requires insurers with more than $100 million in annual premiums to disclose such investments. Insurers also hope for new technologies on carbon control, but conservation and a shift to alternative energies may be the easiest and least expensive approach. – YaleGlobal