Like a Good Neighbor, State Farm Is Scared
U.S. insurers wake up to financial risks of global warming
OK, pound a shot of espresso so you can stay awake for this story, ’cause it matters. Honest. Last week the National Association of Insurance Commissioners, an umbrella group of state insurance officials … hey, come back here! … voted unanimously to assess the potential impact of global warming on the insurance industry and its customers (i.e., most of us). In the wake of almost $100 billion in hurricane-related losses in the past two years, U.S. insurers are finally waking up to what European counterparts like Munich Re have known for years: Growing climate instability seriously threatens the industry’s financials. If you’re wondering what this means to you, consider the tens of thousands of policyholders in New York who got notices last week that Allstate will not be renewing policies in areas vulnerable to hurricanes. Some will lose their coverage as soon as May; at that point, the subject of insurance will no longer bore them at all.
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