Insurance cover could run out if climate change not tackled, threatens report
Insurance claims could treble by 2050, with cover becoming increasingly difficult or potentially impossible to get due to the inevitability of climate change damage, claims a report from Britain's insurance industry this week.
"If no action is taken then we could see claims costs rising between 100 and 200%," Malcolm Tarling, spokesperson for ABI told edie. "If the prospect of a claim becomes inevitable rather than possible, then yes, insurance cover will be harder to come by. Let's take action now wherever we can to tackle climate change."
This is the first report from the ABI to look at the im[act of climate change on the insurance and the business sector. Earlier this year the organisation called for sustained Government support to insure against flood damage, one of the more common environmental threats to assets due to global warming (see related story).
The report, A Changing Climate for Insurance, calls for a partnership approach between Government and industry to tackle issues such as flood defence, building on flood plains, planning permission in areas where wind speed is expected to increase in areas such as the south coast, where it is predicted to increase by 6%. Industry members should also look at whether building materials are robust enough to cope with climate change scenarios.
"Insurance is in the front line of climate change," said John Parker, head of General Insurance at ABI. "Managing risk is central to our industry, and insurers must be equipped to analyse the new risks arising from climate change, and to help customers protect against them. This report provides the industry with a platform to ensure that appropriate action is taken by insurers, Government and other stakeholders to effectively manage climate change."
Environment Minister Elliot Morley welcomed the report. He said: "The insurance industry is right to point out the potential impacts on its business and customers and I welcome their report; the industry, with its expertise in managing risk, is an important contributor to tackling climate change."
He pointed to the increased Government spending on flood defence, along with the Kyoto Protocol and carbon dioxide reduction targets as part of the UK commitments to curbing climate change. However, his statement offered little new insight into government strategies on the possibility of working with industry to develop further abatement measures.
By Sorcha Clifford