Just days ahead of the UN climate change summit in Copenhagen, two leading climate scientists from the Obama administration today will give testimony at a hearing before the House Select Committee on Energy Independence and Global Warming. According to the media advisory, the Select Committee will explore Ã¢â‚¬Å“the urgent, consensus view on our planetary problem: that global warming is real, and the science indicates that it is getting worse.Ã¢â‚¬ Testimony will be provided by Dr. John Holdren, director of the Office of Science and Technology Policy, and Dr. Jane Lubchenco, administrator of the National Oceanic and Atmospheric Administration (NOAA). Meanwhile, in a presentation at the annual conference of the Institute for Business and Home Safety (IBHS) earlier this week, I.I.I. president Dr. Robert Hartwig said the role played by insurers in the climate movement and the process of pricing Ã¢â‚¬Å“greenÃ¢â‚¬ or Ã¢â‚¬Å“climateÃ¢â‚¬ or Ã¢â‚¬Å“environmentalÃ¢â‚¬ risks is no different than any other risk assumed over the centuries. Dr. Hartwig noted that insurers can play a key role in the area of climate risk only if two conditions are met: insurers are allowed to charge risk appropriate premiums on new products designed to mitigate climate risks; insurers are allowed to adjust premiums, underwriting criteria, risk assessment and management practices to reflect actual and expected changes arising from climate threats. Check out I.I.I. information on climate change and insurance.
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.
A few weeks ago we blogged about a decision by the Second U.S. Circuit Court of Appeals in New York that would enable public nuisance claims to proceed against businesses for their contributions to global warming. Two similar cases have now been decided that offer starkly different opinions in the area of climate change litigation. On Friday the Fifth U.S. Circuit Court of Appeals in New Orleans reversed the dismissal of a climate change class action brought by Mississippi property owners who claim that greenhouse gases emitted by oil and gas companies contributed to global warming that added to the ferocity of Hurricane Katrina that caused damage to their properties. Hat tip to the Wall Street Journal Law Blog for its post on the decision which cites J. Russell Jackson, a partner at law firm Skadden Arps saying that at a minimum the ruling will invite more climate change litigation in future. Then in another ruling made public last week, a judge on the U.S. District Court for the Northern District of California dismissed a public nuisance lawsuit brought by the Alaskan coastal town of Kivalina against 24 energy and utility firms. An article in the New York Times by Jennifer Koons of Greenwire notes that the ruling in Native Village of Kivalina v. Exxon Mobil Corp. explicitly broke from the Second CircuitÃ¢â‚¬â„¢s take on whether companies could be held liable for greenhouse gas emissions that contribute to global warming. Appeals are expected in all three cases. Check out I.I.I. information on climate change and insurance.
A decision by the 2nd U.S. Circuit Court of Appeals in New York earlier this week would enable public nuisance claims to proceed against businesses for their contributions to global warming. In Connecticut v. American Electric Power, the 2nd Circuit reversed the district courtÃ¢â‚¬â„¢s decision, effectively giving the green light to a public nuisance lawsuit filed by eight state attorneys general, New York City and three land trusts against six electric power companies based on greenhouse gas emissions. Public nuisance is a common law tort that imposes liability on an individual or entity that interferes with a public right Ã¢â‚¬“ to health and safety, for example. The 2nd Circuit decision would effectively reverse the judicial trend on the public nuisance theory.Ã‚ We recall that in July 2008, the Rhode Island Supreme Court overturned a landmark case against three former lead paint manufacturers, refusing to allow the expansion of the public nuisance law to environmental and product liability cases. For more on MondayÃ¢â‚¬â„¢s ruling, check out an online article at Business Insurance by Joanne Wojcik. Check out I.I.I. info on climate change and insurance issues.
World leaders gather at the United Nations HQ in New York City this week for what is being billed as the highest-level conference yet on climate change. According to the UN this is the largest gathering to-date of heads of state and government on climate change. The meeting comes ahead of the UN climate change conference in Copenhagen in December at which leaders are expected to reach a new global agreement to address climate change. Ã‚ A recent survey by the Carbon Disclosure Project indicated that despite the economic downturn, climate change remains high on the agenda of the worldÃ¢â‚¬â„¢s largest 500 companies. Some 82 percent of companies responded to the survey this year Ã¢â‚¬“ the highest response rate ever from global 500 corporations Ã¢â‚¬“ up from 77 percent last year. The report also showed significant improvements in the key areas of disclosure of greenhouse gas emissions data and targets to reduce emissions. Check out I.I.I. information on climate change and insurance issues.
Climate change is changing both the economic and the natural environment and in both cases the insurance industry can turn these changes into opportunities, according to a new report by the Geneva Association. Release of the report comes as leaders from the Group of Eight (G8) industrialized nations and the main developing economies are due to meet in Italy this week to try to find solutions toÃ‚ keyÃ‚ issues, including how to tackle climate change. The Geneva Association says that insurers have a key role to play in encouraging the general economy and society to develop solutions to minimize climate change impacts by: designing insurance products that incentivize actions to raise resilience; creating innovative products and adapting existing insurance policies to climate change; and as underwriters of, and investors in, future technology. To seize the opportunities to these changes insurers should proactively discover the risk at an early stage, work on the risk control, and offer the preventive measure, the report suggests. At the same time, it notes the importance of increasing awareness of the role of insurance on climate change issues among the general public. Check out I.I.I. information on climate change and insurance.