insurance

Reporting from Copenhagen

It is clear that one of the major sticking points in any agreement at Copenhagen will be adaptation and mitigation finance.

So emotional are the positions behind this particular issue that Lumumba Di-Aping, chief of the Sudanese delegation and chairman of G77 plus China group, told reporters this week:

“The question of adequacy is really a question of what is the finance necessary to carry out actions or to implement programs commensurate with the risk we face.”

Those risks are “condemning” developing countries to non-development, he said. “Ten billion dollars will not buy developing countries enough coffins."

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• Ann Danylkiw's blog
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The insurance industry is in a unique position in the fight against climate change: It can encourage behavior changes simply by doing what so many governments have avoided – putting a price on ignoring the danger.

Just as insurance discounts can encourage safe driving practices, insurers can persuade their clients to embrace energy efficiency and reduce greenhouse gas emissions with financial incentives. Their massive investment power can further pressure corporations and states to take action.

The self-interest is obvious: The potential for insured losses is enormous as global warming brings on stronger storms, longer droughts and more intense heat waves.

“Perhaps no industry is more aligned with the world’s self-interest in preventing the destructive effects of climate change than the insurance industry,” says Mike McGavick, CEO of XL Capital Ltd.

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• Stacy Morford's blog
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The people who assess risk for a living are getting worried about climate change.

Today, the National Association of Insurance Commissioners – the chief insurance regulators from the 50 states and U.S. territories – voted to require insurance companies to disclose the financial risks they face related to global warming.

In addition, the commissioners are requiring insurers to explain how they are preparing to deal with changing risks that could threaten their financial stability in the future, and what the companies are doing to educate state and federal lawmakers and their own policyholders about climate change.