How will insurance be affected by climate change?
National and international climate work
Commissioner Kreidler chairs the National Association of Insurance Commissioners’ (NAIC) Climate Risk and Resilience Working Group (www.naic.org). The group’s goals include:
- Engaging with industry and stakeholders in the U.S. and abroad on climate related risk and resiliency issues.
- Investigate and recommend measures to reduce risks of climate change related to catastrophic events.
- Identify insurance and other financial mechanisms to protect infrastructure and reduce exposure to the public.
In 2016, the OIC joined the UNEP’s Sustainable Insurance Forum (SIF), a network of insurance supervisors and regulators working together to strengthen their response to relevant sustainability challenges.
In 2015, the OIC:
- Joined the Paris Pledge for Action (parispledgeforaction.org) to limit global temperature rise to less than 2 degrees Celsius.
- Became a supporting institution for the UNEP FI Principles for Sustainable Insurance (PSI) Initiative (www.unepfi.org), along with more than 50 other organizations in the largest collaboration between the UN and the insurance industry, backing the aims of the Paris Agreement.
Commissioner Kreidler also participates in the following international sustainable insurance organizations:
- Task Force on Climate-Related Financial Disclosures (fsb-tcfd.org)
- International Association of Insurance Supervisors (iaisweb.org)
Evaluating insurers' climate risk
The OIC led a national work group that developed the guidance for other state regulators to use when they evaluate insurers’ climate change risks and investments during financial examinations. The changes were implemented in 2015.
Since 2010, the OIC has partnered with other states to require insurers with a certain dollar amount of premiums to reply to a survey regarding their preparedness to address climate change risks.
The California Department of Insurance coordinates the survey responses and publishes the results on its website. View its Climate Risk Disclosure (insurance.ca.gov) webpage.