By Gywnne dyer
Guys the two biggest American home insurance companies, State Farm and Allstate, announced last week that they will stop selling insurance policies to Californians. Why? Climate change-related wildfires are making it too risky to insure Californian houses.
California, the most populous US state (40 million people), is now entering the process that began in the United States in 1992, when Hurricane Andrew devastated Miami and the big US insurance companies fled from Florida.
It’s the same in South Africa, in India, in Japan, pretty much everywhere. As the scale and frequency of big climate-related events grows, the big insurers are bailing out of the most seriously affected regions.
That makes short-term sense in terms of avoiding big pay outs, but the companies are gradually destroying their own customer base. That’s not a great long-term strategy.
So if some climate scientist came along with an idea for lessening the impact of global heating, would they be willing to fund it? Maybe so, if it let them go on selling insurance in vulnerable places. Here are two possible matches.
Stephen Salter is a Scottish engineer, emeritus professor at the University of Edinburgh, who has been working on Marine Cloud Brightening for many years. It’s a technique for thickening up low-lying clouds over the ocean so they reflect more incoming sunlight.
It’s intended to hold the global temperature down, but first of all it cools the ocean’s surface – and it occurred to Salter that cooling the ocean’s surface in the right places would weaken or even prevent the formation of hurricanes.
“If you got a group of governments from, let’s say, the Gulf of Mexico who are worried about the damage from hurricanes… What you could say is that we will get the sea surface temperature down from 27°C to 24°C, and you pay us on how close we got to 24°C.”
If the sea surface even drops to 25°C, that would mean fewer hurricanes and weaker ones, Salter explained, and “that would be a way that could look attractive either to governments or maybe to the insurance companies who are insuring against hurricane damage.”
Another example: John Moore is a glaciologist at the University of Lapland who has an idea for slowing down the speed at which glaciers are sliding into the ocean. The faster they flow, the quicker the sea level rises.
Warm sea-water melting the base of the glaciers is what’s speeding them up, so the solution might be to anchor flexible, buoyant plastic curtains to the seabed to steer the warm deep water currents away from the glaciers’ mouths. Maybe start with an experiment on a Greenland glacier, but who would
pay for that? Certainly not the Greenlanders.
John Moore: “There’s payments for preservation of old growth forests, things like the Amazon rainforest that people recognise as a global good. The ice sheet should also be global goods that deserve to have a funding mechanism. One mechanism might be insurance.
“I’ve spoken to insurance companies, and they don’t know within a factor of a hundred what insurance premium level to set for Florida for hurricanes, because sea level rise adds remarkably to those risk estimates.
“If you could add a surcharge of something like $10 per year to an insurance premium in Florida, that could totally compensate the Greenlanders for becoming stewards of the ice sheet instead.”
Never trust the fossil fuel companies, but the insurance companies could turn out to be on the right side (and sell more insurance).