Climate change adding to insurance price hikes, new study says - WPTV News Channel 5 West Palm
Study: Climate change adding to insurance price hikes
WEST PALM BEACH, Fla. — A new study released this month examined how climate change is affecting property insurance and driving up rates.
"The climate connection, you can't deny it," Jeremy Porter of the First Street Foundation said.
The study, titled " The 9th National Risk Assessment: The Climate Insurance Bubble," looked at risk from wind, flooding and wildfires.
6:14 PM, Sep 20, 2023
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The report also looked at insurance in Florida, citing storm intensity as a leading factor in rising insurance rates.
"The reinsurance companies are responding to this. They are the companies driving higher rates for the insurance market," Porter said. "Insurance companies can't keep up with the rate hikes that reinsurance companies are imposing on the insurance companies themselves."
The biggest sign of trouble in the market, Porter said, is the rise of Citizens Insurance as the largest insurer in the state.
Currently, Florida officials are trying to attract private companies to come in and assume Citizens' policies.
Meanwhile, others are suggesting companies and homeowners need to seek out solutions.
"The important thing is that the insurance industry needs to evolve so that it can cover higher risk events and still survive themselves," Bob Bunting of the Climate Adaptation Center in Florida said.
Related Knowledge Center: Climate economics
Climate change is now a driver of the world’s economy. The impact is profound:
- Catastrophic weather events — hurricanes, floods, droughts, high temperatures — are more frequent and more extreme. The cost can be measured in both the initial damage caused and the longer-term impact on the economy.
- Vulnerable communities are increasing climate-related investments, hardening infrastructure and taking other protective measures.
- Investment in carbon capture and storage technologies is increasingly rapidly.
- Governments are making investments and crafting regulations to reduce emissions of carbon dioxide and other greenhouse gases.
On top of all of this is the cost of uncertainty. As the Fourth National Climate Assessment, released in 2018 by the U.S. Global Change Research Program, says, “The assumption that current and future climate conditions will resemble the recent past is no longer valid.”