23 Mar 2009 in Corporate Responsibility
Last week, insurance industry regulators agreed to take an exceptionally strong position on managing environmental risk issues driven by climate change.
The National Association of Insurance Commissioners voted to require insurers to submit annual "climate-risk" reports.The regulators acted because they found climate change threatens insurers in two major ways:
1-- by increasing the risk of extreme weather events such as floods and wildfires, which would boost claims, and
2-- by prompting governments to cap industrial carbon emissions that contribute to global warming -- a move threatens the profits of companies such as coal-fired utilities in which insurers commonly invest.
Such requirements have long been sought by CERES and other environmental groups. See, http://www.ceres.org/Page.aspx?pid=1062
An interesting development in a world where mandatory disclosure is rapidly replacing confidence in pure self-regulation.
