Lloyd's warns insurers to model climate lossesPosted On: Apr. 5, 2007 12:00 AM CST
LONDON Lloyd's of London is urging insurers to begin modeling for higher worldwide losses from such threats as global warming, while at the same time acknowledging that there is much uncertainty around the actual impact of climate change.
In its latest climate change report, Rapid Climate Change, Lloyd's claims that waiting on "definitive scientific pronouncements" on the impact of climate change "seems like an increasingly risky strategy."
"The insurance industry should start planning and modeling now for a higher level of losses across the world by the middle of the century as both the severity and frequency of weather events increase," Lloyd's advises in the study's executive summary.
But as it advises insurers to prepare, the study also acknowledges that climate change science is not exact.
"The impact of climate change is far from certain and not completely understood," Trevor Maynard, manager, emerging risks at Lloyd's, writes in the study.
"However, the experts writing in this report suggest that there is sufficient probability of change occurring within our lifetime to demand our attention now," he added.
The report contains articles on rapid sea level rise, destabilization of ice sheets, increased flood frequency and changes in drought intensity and frequency.
In the study's executive summary, Lloyd's says evidence is building that melting ice sheets will cause sea levels to rise and threaten coastal communities, among other threats.
The study is available at www.lloyds.com