Climate Risk Disclosure: Federal Rules?

We picked up a couple of tidbits on the topic of climate change at the Casualty Actuarial Society (CAS) annual meeting that are worth sharing. A session yesterday on climate risk reporting and monitoring was headed up by Joel Ario, Pennsylvania insurance commissioner and Andrew Logan, of Ceres. Both anticipate a high likelihood that the Securities and Exchange Commission (SEC) will act in 2010 to require all public companies, including insurers, to disclose their climate change risks. A recent article by Evan Lehmann of ClimateWire in the New York Times has more on the potential SEC climate disclosure rules. As some of you know, state insurance regulators earlier this year adopted a mandatory requirement that insurers disclose the financial risks they face from climate change, as well as actions they are taking to respond to those risks. As a result, all insurers with annual premiums of $500 million or more are required for the first time to complete the annual climate risk disclosure survey developed by the National Association of Insurance Commissioners (NAIC) by May 1, 2010. The threshold for participation in the survey will expand to insurers with annual premiums of $300 million or more in 2011, according to Ario. Also, the NAIC will be holding a Climate Change Risk Summit as part of its upcoming Winter National meeting in San Francisco this December. The summit is scheduled for December 9. Check out I.I.I. information on climate change and insurance.

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