Climate Change and Insurance

Here's a case worth watching - one of many possible future climate change-related insurance and risk management issues.

In this case, the issue is how "climate change" relates to the definition of a loss or occurrence in an insurance policy. Ultimately, of course, another issue will be whether a company can be held liable for causing or contributing to climate change - and whether "damage" from climate change can be identified reasonably and measurably.

Down the road, consistency in these and other decisions will be critical. For example, if climate change is accepted as leading to more frequent and harsher hurricanes, then logically insurers should be allowed rate increases to reflect that greater exposure.

The next decade or so should be interesting...

- Rick