Entries tagged with “Environment”.


Climate change is among the five most likely and most potentially impactful global risks, according to the just-released World Economic Forum (WEF) 2014 Global Risks Report.

The report assesses 31 risks that are global in nature and have the potential to cause significant negative impact across entire countries and industries if they take place.

An analysis of the five risks considered most likely and most impactful since 2007 shows that environmental risks, such as climate change, extreme weather events and water scarcity, have become more prominent since 2011 (see chart above).

This suggests a pressing need for better public information about the potential consequences of environmental threats, the WEF says.

Concern about socio-economic risks such as income disparity, unemployment and fiscal crises has become more prominent over the years.

The report reveals that fiscal crises and structural unemployment and underemployment are among the most impactful risks while the latter also feature among those most likely to occur. This has knock-on effects on income disparities, which is regarded as the overall most likely risk, the WEF notes.

Cyber attacks and the breakdown of critical information infrastructure also feature among the most prominent risks in this year’s report.

The WEF notes:

This arguably reflects the increasing digitization of economies and societies, where rising dependence on information and data, as well as the systems to analyze and use them, has made attacks more likely and their effects more impactful.”

WEF note: Global risks may not be strictly comparable across years, as definitions and the set of global risks have been revised with new issues having emerged on the 10-year horizon. For example, cyber attacks, income disparity and unemployment entered the set of global risks in 2012. Some global risks were reclassified: water supply crises and income disparity were reclassified as environmental and societal risks, respectively, in 2014.

The report is published in collaboration with Marsh & McLennan Companies, Swiss Re, Zurich Insurance Group, National University of Singapore, Oxford Martin School, University of Oxford, Wharton Risk Management and Decision Processes Center, University of Pennsylvania.

Oh deer, it’s that time of year again. State Farm has just released its annual report on U.S. deer-vehicle collisions.

State Farm’s findings show that for the third consecutive year, the number of deer-vehicle collisions has dropped, and the downturn is accelerating.

Using its claims data, State Farm estimates that 1.09 million collisions between deer and vehicles occurred in the U.S. between July 1, 2010 and June 30, 2011. That’s 9 percent less than three years ago and 7 percent fewer than a year ago.

However, the average property damage cost of these incidents was $3,171, up 2.2 percent from the year before.

For the fifth year in a row, West Virginia tops the list of states where an individual driver is most likely to run into a deer. State Farm calculates the chances of a West Virginia motorist striking a deer over the next 12 months at 1 in 53, an improvement over last year’s odds of 1 in 42.

Iowa remains second on the list (1 in 77), followed by South Dakota (1 in 81) which moves up one place to third, Pennsylvania (1 in 86) which jumps two places to fourth, Michigan (1 in 90) which drops from third to fifth.

November, the heart of deer migration and mating season, is the month during which deer-vehicle encounters are most likely, with more than 18 percent of such mishaps occurring in this month.

So why are deer-vehicle collisions declining?

In a press release, State Farm notes:

While we can’t put our finger directly on what’s causing a decline in deer-vehicle collisions, we’d like to think media attention to our annual report on this subject has had at least a little bit to do with it.”

What do you think?

Check out I.I.I. tips on how to avoid deer/car collisions.

Check out State Farm’s map to see if you live in a high risk state:

 

The news wires are buzzing with reaction to a landmark environmental case in which an Ecuador court ordered U.S. oil giant Chevron Corp. to pay $8.6 billion to clean up oil pollution in Ecuador’s rain forest.

The award is believed to be the largest ever imposed for environmental contamination and could double if Chevron does not publicly apologize for the oil pollution within the next 15 days, as ordered by the judge.

Today an article in the New York Times follows up with the news that representatives for Ecuadorean villagers say they plan to pursue Chevron in more than a dozen countries where it operates in a bid to force the company to pay.

The case has been the subject of proceedings in courts in Ecuador and the U.S. for nearly 20 years.

Residents of Ecuador’s Amazon forest, who are plaintiffs in the case, are attempting to hold Chevron liable for environmental damage they claim resulted from the operations of Texaco Inc. in the region from 1965 to 1992. Chevron inherited the suit when it acquired Texaco in 2001.

An editorial in the Wall Street Journal observes:

The Ecuador suit is a form of global forum shopping, with U.S. trial lawyers and NGOs trying to hold American companies hostage in the world’s least accountable and transparent legal systems. If the plaintiffs prevail, the result could be a global free-for-all against U.S. multinationals in foreign jurisdictions.”

The LA Times quotes John van Schaik, oil analyst at Medley Global Advisors in New York, saying:

The appeals could go on for many years. But the fact that the Lago Agrio court ruled in favor of the plaintiffs sends a signal to oil companies that, more than ever, they need to be good corporate citizens.”

Meanwhile, the president of the U.S. Chamber of Commerce said the ruling against Chevron “runs contrary to the fundamental rule of law.”

The case is being watched closely by other multinational corporations.

Check out the Huffington Post for more on this story.

You may have seen the video footage of the wave of toxic red sludge that flooded out of a failed reservoir at an alumina refining plant in Hungary on Monday, inundating villages and leaving at least four dead and 120 injured.

Today NPR reports that the sludge has reached the Danube River – Europe’s second longest river – though Hungarian officials are quoted as saying no immediate damage is evident.

The European Union earlier had warned that the spill could pose a serious environmental problem for 12 countries if it contaminates the Danube.

The flood, estimated at 700,000 cubic meters, or 185 million gallons, swept cars off roads, damaged bridges and houses and forced the evacuation of hundreds of residents, according to the New York Times. People who came into contact with the substance were burned through their clothes.

Authorities have ordered a criminal inquiry into the accident. It is still not known why part of the reservoir wall collapsed. The Ajkai Timfoldgyar plant is owned by Hungarian aluminum production and trade company MAL Rt.

The disaster underscores the point recently made by I.I.I. president Dr. Robert Hartwig that large-scale industrial accidents are not as rare as you might think and can result in losses in the hundreds of millions of dollars. Earlier this year, a power plant in Middletown, Connecticut exploded leaving five dead and 27 injured.

Insurers play a key role in insuring these facilities.

Man-made global disasters triggered insured losses of about $4 billion in 2009, according to Swiss Re. Some 155 man-made disasters occurred in 2009, including major industrial fires and explosions; aviation, maritime and rail disasters; mining accidents; building/bridge collapses; and losses related to terrorism and social unrest.

The April 2010 explosion at the BP Deepwater Horizon oil rig in the Gulf of Mexico will add to the insured loss tally from man-made disasters this year.

As for environmental liability arising from the disaster in Hungary, Europe’s Environmental Liability Directive (ELD), in effect since April 30, 2007, is based on the “polluter pays” principle.

A bulletin released by Aon and reported at Insurance Journal, warns companies with industrial operations in Europe that the ELD leaves no place to hide:

Under the ELD, all companies have a liability and many, because of the nature of their operations, do not even have to be at fault if the environment is damaged due to the actions of a company.”

Aon goes on to warn that events such as this could ultimately lead to the total collapse of a company at fault if they do not have suitable insurance coverage in place.

Comprehensive environmental insurance programs can be put in place and the market can provide coverage for up to €150 million ($210 million) for an individual risk, Aon adds.

Speculation is mounting that the growing oil spill in the Gulf of Mexico following the explosion, fire and sinking of the Deepwater Horizon oil rig off the coast of Louisiana may prompt the declaration of a federal disaster. The Jackson Clarion Ledger reports that just as Mississippi Governor Haley Barbour submits a disaster declaration request to President Obama for last Saturday’s deadly tornado, another major disaster looms for Mississippi.

Latest reports suggest oil is leaking at the rate of 5,000 barrels a day from the damaged rig, not 1,000 as had been initially estimated and officials believe the spill could reach the coast of southeastern Louisiana as soon as Friday night. The Clarion Ledger reports:

The impact of the spill is a direct threat to the state’s shrimp and oyster fishermen and to some of the state’s most pristine and important wetlands. Those areas have only recently begun to recover from 2005′s Hurricane Katrina.”

Meanwhile, a post at the Mississippi Press blog cites experts saying that although federal disaster declarations usually follow hurricanes and other natural catastrophes, the manmade oil spill in the Gulf could conceivably qualify as well. It quotes a spokesman for Gov. Barbour saying that while officials are still focused on keeping the oil spill offshore, a disaster declaration “would be one of the options open to us.”

According to FEMA data, there have been 35 major disaster declarations in 2010 so far – all of which were for various weather-related events. A major disaster declaration must be requested in writing to the President by the governor of a particular state. In this request the Governor certifies that the combined local, county and state resources are insufficient and that the situation is beyond their recovery capabilities.

The Mississippi Press blog notes that in 2001 then-President George W. Bush issued major disaster declarations for Virginia and New York following the September 11 terrorist attack. Two years later, he also issued a less-weighty emergency declaration for Texas and Louisiana following the loss of the space shuttle. Check out I.I.I. information on offshore energy facilities and insurance considerations.

Concerns are rising about the potential environmental impact after the sinking of the Deepwater Horizon oil rig in the Gulf of Mexico about 50 miles off the coast of Louisiana. Eleven workers are feared dead and 17 others were injured following an explosion and fire that ripped through the rig late Tuesday. The rig, which is owned by offshore drilling contractor Transocean Ltd, was under contract to oil giant BP, according to media reports. Check out a Guy Carpenter risk report for more on this story. An article in the New York Times notes that the potential for environmental disaster from the spill would be greatest if the oil were to reach the Louisiana coast. BP was reported to be dispatching a flotilla of more than 30 vessels capable of skimming more than 170,000 barrels of oil a day to protect sea lanes and wildlife in the area of the sunken platform. A Reuters report focuses on the financial impact of the loss of the rig for Transocean Ltd, noting analysts’ comments that the cost of the rig will be largely covered by insurance. The comments underscore the point that insurance provides support to many different industries, including energy. Check out a recent presentation by I.I.I. president Dr. Robert Hartwig for information on the impact of the global financial crisis on the energy sector and trends and challenges in energy markets.

The Environmental Protection Agency (EPA) yesterday said it has determined that a public health emergency exists at the Libby asbestos site in northwest Montana. This is the first time the EPA has made a public health emergency declaration under the Superfund law (CERCLA). “This determination recognizes the serious impact to the public health from the contamination at Libby and underscores the need for further action and health care for area residents who have been or may be exposed to asbestos,” said the EPA in a press release. It noted that investigations performed by the Agency for Toxic Substance and Disease Registry have found the incidence of occurrence of asbestosis in the Libby area staggeringly higher than the national average for the period from 1979-1998. In 1963, W.R. Grace, a construction materials and chemicals company bought Zonolite, a Libby, MT company that mined vermiculite, a mineral contaminated with asbestos. Last month a Montana federal jury acquitted W.R. Grace and three former executives of criminal charges related to the contamination. The Libby asbestos site has been on the EPA’s Superfund national priorities list since 2002, and cleanup has taken place since 2000. The mine closed in 1990. Check out I.I.I. information on asbestos liability.