Insurance Industry Looking Hard At Climate Change

A recent paper in Science (abstract) examines the insurance industry's reaction to climate change. The industry rakes in trillions of dollars in revenues every year, and a shifting climate would have the potential to drastically cut into the profits left over after settlements have been paid. Hurricane Sandy alone did about $80 billion worth of damage to New York and New Jersey. With incredible amounts of money at stake, the industry is taking climate projections quite seriously. From the article: "Many insurers are using climate science to better quantify and diversify their exposure, more accurately price and communicate risk, and target adaptation and loss-prevention efforts. They also analyze their extensive databases of historical weather- and climate-related losses, for both large- and small-scale events. But insurance modeling is a distinct discipline. Unlike climate models, insurers? models extrapolate historical data rather than simulate the climate system, and they require outputs at finer scales and shorter time frames than climate models."

Source: http://rss.slashdot.org/~r/Slashdot/slashdotScience/~3/_va5csNEpxs/story01.htm

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