Standard & Poor’s: Abrupt climate change could challenge insurance industry
Insurers could be underestimating how climate change will affect their business, according to a study released today by ratings agency Standard & Poor’s.
Miroslav Petkov, director, insurance ratings at Standard & Poor’s, said: “Our analysis indicates that insurers' capital management will be sufficient to manage the additional strain of a reduction of about 0.5 per cent in capital adequacy per year, possibly at the expense of dividends being five to 10 per cent lower. The effect of a sudden climate change shock, however, could test the industry.”
The report comes ahead of the United Nations conference on climate change, which is due to take place in Paris later this year.