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Born at the Crest of the Empire

Wednesday, October 05, 2005

Global Warming from those with a Business Interest.

Swiss Re, a massive reinsurer has for a long while been talking about global warming as it might impact the insurance business, their business, in the coming years. Other insurance companies are always cited in these articles, but the reinsurers, those that insure the insurance companies and thus are liable for the largest claim spikes, have been publicly talking about global warming for years now. Everytime there is a massive weather related insurance surge, articles like this show up. As example, I remember the same articles after the series of hurricanes in Florida last year.

We should take these guys seriously, as their research is not based on "politics" but instead on the very real projections of their business costs. Their research is profit based and very well funded because of the potential impact on their bottom line. We should pay attention to what they have to say.

The devastation and cost of Hurricane Katrina provided a new hook for a faction of the insurance industry that is trying to raise public awareness of global warming and push the topic onto the political agenda.

Some of the industry's largest companies have sided with environmental groups in recent years to argue that global warming exists and that man-made causes are adding to the severity and cost of natural catastrophes. ......

Swiss Re since 1994 has endorsed the idea that the climate is changing and employs 20 scientists and engineers to study the question.

While quick to note that no event or its severity can yet be linked with certainty to climate change, some insurers began to take the position that governments nonetheless should take preventive action to reduce greenhouse emissions in the atmosphere.

While it confines most of its climate emphasis to raising public awareness, Swiss Re has pushed for political action. For instance, it has worked with a United Nations-sponsored insurance group that backed the 1997 Kyoto Protocol, an international agreement to limit so-called greenhouse gas emissions, particularly in industrialized countries. The company, in a policy statement, says that even natural climate changes carry "risks far greater than generally assumed" and that man-made influence on climate will aggravate them.

"It is a dangerous misconception to regard even minor changes in climate behaviour as nonthreatening," the company said in the statement. "Even a small shift in the climate pattern can lead to a disproportionately frequent failure of protective measures. Once protection measures fail, loss figures rise exponentially."

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