The Insurance Industry, soon to be the first pillar of Capitalism to succumb to Abrupt Climate Change

“Climate change could punch a hole through the financial system by making 30-year home mortgages — the lifeblood of the American housing market — effectively unobtainable in entire regions across parts of the U.S.”
“Climate change could end mortgages as we know them”

“Natural disasters are being recorded more frequently than ever before. “Since 1970, the number of disasters worldwide has more than quadrupled to around 400 a year,” and “there are six times more hydrological events now than in 1980,” The 10 Most Costly Natural Disasters of the Century
“There is a logistical hurdle: when a catastrophe bond experiences a so-called loss event, the capital in the investment is suspended until the full cost of a disaster is pinned down. The phenomenon of “loss creep”, where initial estimates of a loss balloon months or even years after the event, has also spooked some investors. The cost of Typhoon Jebi in Japan last year rose from initial expectations of $6bn to $15bn.”
“Over two years, natural catastrophes caused a record $225bn of insured losses”.
Why climate change is the new 9/11 for insurance companies

“For the insurance industry, global warming has advanced from a future ecological challenge to a present financial shock. Together, total losses to the economy from natural catastrophes and “man-made disasters” reached $165 billion in 2018; that followed a 2017 that, at $350 billion, cost more than twice as much. As a result, according to the Swiss Re Institute, the company’s research arm, 2017 and 2018 were for insurers the most-expensive two-year period of such catastrophes on record, requiring them to fork over $219 billion globally in checks.”
Climate Change Is Hitting the Insurance Industry Hard

“Regulators are starting to worry about climate change.”
“Jenkins points out that the Bank of England’s Prudential Regulation Authority is leading the way on stress-testing insurers against the risk that the world misses its carbon reduction targets.”

“In such a scenario, insurers, especially in the U.S. where price increases are restricted by regulators, may find it increasingly unattractive to offer coverage,” he writes. “Greater lay-off of risk to reinsurers is one option. But more restrictive policies or wholesale withdrawal of cover are also possible. At some juncture underwriters will need to remove their blinkers and acknowledge that a world awash with worsening climate change risks is not necessarily just bad for the planet. It could be bad for the insurance industry too. A bit like 9/11.” Climate Change Tops List of World’s ‘Extreme Risks’

“Venice is on its knees,” said Brugnaro. “The damage will run into hundreds of millions of euros.” Flood, fire and plague: climate change blamed for disasters
“Last year, insurance payouts caused by climate-related events totaled $2.4 trillion worldwide.” Can Insurance Companies Weather The Storm? What Climate Change Means For The Industry

Clearly the cost of disasters is on the same Hockey Stick trajectory as our climate crisis yet “Business as Usual” carries on as if nothing has changed. All ponzi schemes eventually implode and this one will be no different except in scale. There is no previous analogue to remotely compare with the coming collapse.

I'm an anti-imperialist, environmental activist and blue ocean sailor, who is passionate about the earth and all it's inhabitants without favour. Brace for imminent impact as we bare witness to the non-linear unraveling of the biosphere and habitability disappearing for most if not all complex life on the only habitable planet we know of. To quote President Niinistö in North Russia: ‘If We Lose the Arctic, We Lose the World’. Folks we have lost the Arctic.

Posted in Abrupt Climate Change, Collapse, Insurance
159 comments on “The Insurance Industry, soon to be the first pillar of Capitalism to succumb to Abrupt Climate Change
  1. Kevin Hester says:

    Led by the deadly and costly Hurricane Ida and massive flooding in Europe, the world racked up $329 billion in economic losses linked to severe weather last year, and only 38% of that bill was covered by insurance.


    • sealintheselkirks says:

      You did read about the monster Super-cyclone that just slammed the Philippines, yes? Latest count was 1,500,000 homes destroyed. So, being a Catholic country without birth control we’re looking at what, 8 million homeless from one storm? Six kids or so, mom & dad, and they tend to live with relatives also. Maybe 10 million homeless then adding in the aunties and grandparents etc etc?

      It wasn’t as strong as Hainan a few years ago but a much wider storm path. I mean, Hainan was a Category 6 at 200mph when it hit the beach but it doesn’t seem like anybody ‘in charge’ wants to reflect reality by increasing the threat level by upping the numerical value.

      Somehow I don’t think those poor people had much insurance for their rickety-built homes. Maybe businesses did, or the wealthy, but for most poor people insurance just doesn’t exist.

      Imagine the damage of 200mph Category 6 like Hainan hitting Houston TX or Miami FL? Or anywhere else along the US Gulf & Eastern seaboard? That wake up call is going to be a doozy for the insurance industry. And it will only get worse.

      But when we remember what Mexico Beach Florida looked like after Hurricane Michael hit with 160mph winds a few years ago? Mostly piles of broken wood and debris! I read that one storm cost $25 billion, and it’s ‘looking to the future’ as they build RIGHT BY THE BEACH EDGE again dead on against the same beach road. Bigger buildings, too, looks like more apartment blocks going up in the latest photos, and the ads are all about ‘getting back to normal’ and ‘city on the mend’ and ‘mexico beach on the move’ as if it could never happen again. Nobody really wants to understand climate collapse. Of course not! It’s all about real estate profits!

      I started laughing when I bumped into this; Mexico Beach voted ‘most favorite Southern beach town…in Garden and Gun magazine. So do old ladies garden with .40 caliber Glocks strapped to their hips? Probably. After all it IS Florida and them white folk are always on the lookout for Those People coming to rob them.

      For some reason I just don’t feel the urge to go live there. Noticed in the recent pictures that there is a lot of open space where houses used to be crammed together in the before pics….


      Liked by 1 person

  2. sealintheselkirks says:

    How far will an insurance collapse go? Can it fall so hard that it will affect this side of what they do?

    Exposing the Massive Hypocrisy of International Insurance Companies


    Liked by 1 person

  3. Kevin Hester says:

    “What If I Can’t Insure My Home At All?”
    Insurance companies are leaving homeowners at the mercy of climate catastrophes they helped create.


  4. Kevin Hester says:

    Pooling risk to insure against natural disaster
    We have to pivot to a new insurance model for climate change before we go under, warns University of Queensland expert.


  5. Kevin Hester says:

    Pooling risk to insure against natural disaster
    We have to pivot to a new insurance model for climate change before we go under, warns University of Queensland expert.


  6. Kevin Hester says:

    “Megan Cusack, a barrister whose chambers were filled almost to the ceiling with water, said she did not have contents insurance.

    “You can’t get insurance for floods here, unless you want to spend A$20,000 [US14,500] a year.” She estimated the damage at A$100,000.

    Robin Gilmore, who owns the Civic Hotel, where floodwaters reached the second floor, estimated his losses at A$2.5mn. Local resident Max, 74, who had to be rescued from his front porch in waist-deep water, said he would have to raid his pension to pay for the damage. Neither had insurance.”


    • sealintheselkirks says:

      Kevin, there will be a point where there isn’t anywhere to retreat to except high ground. And who owns the high ground and will they let people onto their property? Probably not.

      This popped up Friday:

      Thoughts From a Drought-Stricken, Flooded Australia

      And it was 68F yesterday, 70F today. Oh my. At the end of March in the PacNorthWest.This sure doesn’t look good.

      While the US Southwest is getting hit again and the entire ‘weather event’ of last weeks 56 tornadoes is about to be repeated this week. Starting tomorrow as a matter of fact. I’m guessing their god is extremely pissed at those racist slave-state Trump voters? Is there a correlation between them and Oz because it seems they’re being taught some kind of lesson at the same time Down Under is…floods and tornadoes instead of Bomb Cyclones but really let us not be picky because the end results are very much the same aren’t they?

      Is this how the Rapture starts? Inquiring minds want to know!


      Liked by 1 person

  7. sealintheselkirks says:

    Florida is freaking out with Hurricane season on the way. So this article wouldn’t separate from the others that are all under the same link (WPEC in Florida) so I’m pasting it. It’s short but damned telling on what Big Insure is expecting…or knows! The politicians can’t do anything but try pasting more band-aids on the disappearing insurance carriers…


    Lawmakers press for special session on Florida’s property insurance crisis

    WEST PALM BEACH, Fla. (WPEC) – Florida lawmakers are warning the clock is ticking for the state to address a growing property insurance crisis before the impending hurricane season.

    Lawmakers press for special session on Florida’s property insurance crisis (WPEC)
    Sen. Jeff Brandes, R-St. Petersburg, sent an email to fellow legislators Friday, polling them on whether or not they would return to Tallahassee and take up the property insurance issue.

    The legislature did not address property insurance during its 60-day regular legislative session that ended in early March.

    At least five insurance providers have pulled out of Florida, leaving thousands to find new coverage. The companies that remain, including the state-backed Citizens Property Insurance Corporation, are drastically raising their rates, pricing many out of their policies.
    Nancy Hultman, a Citizen’s customer in Boca Raton, recently told WPEC she’s been forced to move out of Florida because of the high cost of her policy.

    “It’s just ridiculous. you shouldn’t be in a forced situation by an insurance company,” she said.

    WPEC contacted every lawmaker representing Palm Beach County and some from the Treasure Coast, asking if they would support a special session to address property insurance.

    Of the lawmakers WPEC contacted, nine responded. Nearly every single Democrat who responded said they would support a special session held as soon as possible.
    Rep, Matt Willhite, D-Wellington, Ranking Member of the Insurance and Banking Subcommittee, said he would also be in favor of a special session if lawmakers had a clear legislative plan to address the property insurance issue. He said, so far, he has not seen such a plan from his colleagues.

    Two Republicans responded: Rep. John Snyder, R-Stuart, and Rep. Rick Roth, R-West Palm Beach. Both said they wanted to tackle property insurance, with Snyder saying he would support a special session if the governor called for one.

    Some lawmakers have also signaled they expect to tackle the property insurance issue after the November election, which would come just before the end of hurricane season.

    Liked by 1 person

  8. sealintheselkirks says:

    This is gonna hurt. From yesterday…



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Kevin Hester

Kevin Hester is currently living on Rakino Island, a small island in the Hauraki Gulf near Auckland, New Zealand, monitoring the unravelling of the biosphere and volunteering at the Rakino Island Nursery is currently developing a proposal to create a marine reserve near by. The Island has no grid tied electricity or reticulated water.  I catch my own water from the roof and generate my electricity from the ample solar radiation on the island.

My Submission to the Ministry of the Environment
Kevin Hester, Dropping Anchor in an Exponential World
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