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Fitch Ratings Ltd. said that increased frequency and severity of extreme weather events due to climate change could result in the U.K.'s government-backed reinsurance scheme Flood Re “being inadequately funded”, reported Artemis.bm.
The rating agency said that any shortfall in the capacity of Flood Re due to higher-than expected flood losses from climate change would most likely see insurers and reinsurers cover the additional costs, which in turn could result in higher annual premiums for policyholders.