The number and ferocity of those storms have been rising for at least 25 years. It's unclear what's causing the rise, but many insurers are responding by raising rates and reducing policies. Factors behind the damage could include expanded development and rising property values.
But some insurers also believe climate change is playing a part.
The Interinsurance Exchange of the Automobile Club, which collected $2.1 billion in premiums last year, writes homeowners insurance policies in Missouri, Texas and California. Those areas face "catastrophic risk" that could be increased by global warming, the company told California insurance regulators this month.
"The primary risk that climate change may pose would be any potential increase in the frequency or intensity of strong thunderstorms, hurricanes or brushfires," the company said on a climate risk disclosure form that California began requiring insurers to file this year.
"More severe or more frequent events would increase the number and cost of claims and have an impact on the financial health of the company," the Automobile Club wrote. "If the impact was large enough, it could affect our ability to write new or renew business in some catastrophe exposed areas."
About 1,200 tornadoes touch down in the United States annually, but this year is on pace for more. About 1,076 twisters have already been counted -- and that was before the storms in Missouri this week.
The accelerating activity has convinced Allstate Insurance Co. that the change is permanent. Chairman and CEO Thomas Wilson told Wall Street analysts last month that the company now believes it will face about $2 billion in damage annually from thunderstorms -- about four times the amount it paid a decade ago.
Reprinted from Climatewire with permission from Environment & Energy Publishing, LLC. www.eenews.net, 202-628-6500
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Add CommentThe consequences of global warming are perhaps foreshadowed by this event, although I am sure that we will continue to deny any connection between increasing storms and the fact that we are pouring greenhouse gases into the atmosphere. Scientific American will continue to be a cheerleader for the technoscience fix rather than for energy conservation.
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