Presentation on theme: "Climate Change & Insurance: Threat or Opportunity? Brett Schreiber Marketing Fisher College of Business."— Presentation transcript:
Climate Change & Insurance: Threat or Opportunity? Brett Schreiber Marketing Fisher College of Business
Global Warming Determination Intergovernmental Panel on Climate Change (IPCC) is made up of thousands of scientists that come up with a defined statement on climate change 5 assesments have been made with the last assessment being in September of 2013 http://www.youtube.com/watch?v=rFYbdHW7QAM
Highlights from IPCC AR5 95% sure the climate change is manmade Increase from 90% in 2007 and 66% in 2001 The pause-.22 deg F increase per decade since 1950 while this has leveled off to.09 deg F since 1998 Conflict: models are not reproducing warming of last 15 years El Nino/La Nina
What Insurance Companies Think of the Climate Change There has been almost unanimous agreement that the climate is changing Mainly worry about increasingly severe weather events and global warming More severe natural disaster makes for more cost in damages. Ex: 12.3 billion dollars going to corn farmers that suffered from last years drought
Pricing Response With increased severity of these weather events, potential losses are inevitable Talks of risk adequate pricing and less availiability in high risk areas
Risk Management Response Loss prevention is thought of as a more reasonable approach By limiting the amount of on-site fuel accumulation, changing roofing materials, clearing brush around the buildings and even by not using a lot of oil-based plants in the landscaping, we can manage the liability so we can still put our capacity out there even in high-risk zones. -Zurich Insurance
Opportunity A more climate threatened world gives insurance companies the ability to increase revenue through covering other emerging business that is trying to solve the problem Most seen in alternative energy Some governments encourage alternative energy with incentives Ex: Germany and solar power Risk of renewable energy is that they may not be operational in some nature conditions.
Review IPCC determined 95% of climate change is human caused The increase in temp. has leveled off but thought to be due to El Nino/La Nina Major Human impact on climate includes altering land cover, pollutants, and GHGs Climate change does provide difficulties for insurance companies, but also gives opportunities through renewable resources and risk management
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