The UN Intergovernmental Panel on Climate Change’s 2014 report concluded that ‘extreme precipitation events will become more intense and frequent in many regions”, this will result in a surge in property damage insurance claims therefore corporate responsibility should be a main consideration for management with responsibility for same.
After two freak weather events namely, “Storm Ophelia” and “The Beast from the East” we wonder what other storms, snows, floods, landslides which could impact on the loss of life are in our future.
From a global perspective, health impacts from infectious diseases, food poisoning, property damages, infrastructural loss, agricultural loss, insurance loss, etc. in another report issued in 2016, the UN Environmental report on Global Warming suggests that the change sweeping the world is occurring at a faster pace that previously predicted therefore as we have a duty to uphold the landscape as we know it, an awareness of Greener business is a must.
We have witnessed flooding in Ireland in 2010 and 2014 which caused major property damage insurance claims, numerous private and commercial property owners including small businesses cant insure their property for flood risk as insurers used geographical maps to predict the likelihood of a flood, even our previous Taoiseach Enda Kenny suggested that we should build property on higher ground, this seems like a logical statement however the unfortunate people that are heavily indebted to their properties in flood zones may disagree.
The current issue proves pressing between the insurers and local authorities due to the fact local authorities are attempting to install flood defences however insurers remain cautious in providing cover due to the fact major floods increase loss ratios and can lead to unprofitable business on their part. Floods cause untold property damage insurance claims as was witnessed in several flooding events in living history.
S&P Global reported that Ireland is less prone to a natural catastrophe stating we are at an “intermediate” rather than “high” level of risk, it should be noted that catastrophes threaten the global financial system therefore the insurance industry should implement systems which all them to deal with these situations if they occur.
Most insurance companies have a responsibility to their investors, owners or shareholders therefore the longer-term view is often not developed and implemented in a timely manner, it would appear prudent in a longer-term view to develop climate friendly insurance products, promote climate protection projects, eco balance sheets, etc.
Focusing on a longer-term view is not only ethical but would prove to reduce the overall property damage insurance claims in the longer term.