Climate Change Posing An Increasingly Unpredictable Risk for Insurers

The risk to insurers from climate change is significant. While climate change is a growth opportunity for new products, the increasingly unpredictable risks are problematic for the insurance industry, a March 15 Moody’s report notes. Climate change risk is a topic that Moody’s has consistently warned about.   In The Ostrich Paradox: Why We Underprepared for Disasters, authors Robert Meyer and Howard Kunreuther point out that several human personality traits prevent people from truly understanding their real risk exposure to natural disasters. They say individuals focus on short time horizons and under prepare for future threats. When disaster does strike, while there is an…