If you live in a medium—to high-risk climate change consequence area, right or wrong, it's only a matter of time before your insurance company skyrockets your rates or cancels your policy.

The accelerating consequences of climate change, along with their substantial insurance damage payouts, have thrown the global insurance industry into financial chaos. This financial chaos in the insurance industry has led many state and national governments to attempt to force insurance companies to maintain their coverage in areas with medium—to—high risk climate change consequences.

 

Introduction

The "too little, too late" government enforcement strategy is proving to be a flawed approach to achieving insurance policyholder justice, and it will not address the underlying problem. Forcing state and national governments to require insurance companies to maintain climate change-related coverage in medium- to high-risk areas is a fool's errand with multiple worse outcomes.

If insurance companies are somehow forced by state or national governments to maintain insurance in medium to high-risk climate change areas:

1. Expect your home business and other location-related insurance premiums to rise quickly by 100 to 300 percent or even more. Or,

2. Expect insurance companies to cancel all policies for homes, businesses, farms, autos, crop failure, and even some life insurance in most climate change medium to high-risk areas.

Chaos in the insurance industry

Insurance and insurance coverage in the era of rising climate change and global warming will continue to pose a significant threat to homeowners, businesses, and farmers. (Reinsurance companies insure the insurance companies against loss and bankruptcy for specified risks.) There will be a steadily increasing loss of all property and mortgage insurance covering climate change-related risks.

The accelerating consequences of climate change, along with their substantial insurance damage payouts, have thrown the global insurance and reinsurance industry into financial chaos. This economic chaos has led many state and national governments to desperately try to force insurance and reinsurance companies to maintain their coverage in medium— to high-risk areas with climate change consequences. This government enforcement strategy is a flawed approach to achieving insurance justice, as it will not effectively address the underlying problem.

Forcing state and national governments to require insurance and reinsurance companies to maintain climate change-related coverage in medium to high-risk areas is a fool's errand with multiple worse outcomes. If insurance and reinsurance companies are unfairly forced by state or national governments to maintain insurance in medium to higher-risk climate change areas:

1. Expect your insurance premiums to rise quickly by 100 to 300 percent or even more. Or, 

2. Expect insurance and reinsurance companies to cancel all their policies for homes, businesses, farms, autos, and crop failure in most climate change medium to high-risk areas.

Suppose state or national governments unfairly force insurance and reinsurance companies to maintain insurance in medium to high-risk climate change areas. In that case, insurance companies should and eventually will also demand the following in exchange for preserving coverage: 

1. The government guarantees that they can immediately raise their rates whenever the many different consequences of climate change increase. This would include increasing their rates as much as needed to cover all additional climate change losses, plus a fair profit margin. These rates would not be raised only in medium- to high-risk climate change areas. These rate increases would include everyone insured by that particular insurer. For example, in the climate change-driven states of California and Florida, where wildfires and flooding are prevalent, do not be surprised if insurance carriers still have policies that require regular annual increases of 20 to 40% or more to cover risks in climate change areas. 

2. The government guarantees that insurance and reinsurance companies can use new 1,000—and 10,000-year floodplain, wildfire, and extreme weather risk charts. Independent climate change researchers would create these charts because current climate change information used by the US Geological Survey and governments around the world has been wildly distorted by the billions of dollars spent on climate change disinformation by the global fossil fuel cartel. Without further state or national approval, these new charts also enable insurance and reinsurance companies to rapidly expand the definition and scope of medium to high-risk climate change areas, thereby always controlling their risks and losses. 

3. The government guarantees that the state and national governments will finally do their job to enforce the correct and urgently needed fossil fuel reduction regulations on toxic carbon and methane pollution from fossil fuel use. Over the following decades, this will gradually reduce insurance and reinsurance climate change risks and losses. However, this is a slow recovery process, so coverage will be tricky for decades.

4. The government guarantees that the state or national governments will immediately establish adequate Managed Retreat, which is where state and national buyback funds, funded by taxpayer contributions, are used to purchase all homes, businesses, and farms in climate change medium to high-risk areas that will be severely damaged and destroyed repeatedly. This must be done because any insurance or reinsurance property claim payouts provided to damaged and destroyed homes, businesses, and farms in those medium to high-risk areas would be a waste of additional valuable taxpayer resources (or insurance company resources) with no discernible benefit.

Financing Managed Retreat would be shifted to the full responsibility of state and national governments to make restitution for their decades of failure to protect their citizens from escalating climate change, when the horrendous consequences were well-known over 60 years ago.

(Please note that in addition to a very quiet, almost secretive current process of selective government-funded Managed Retreat, there will be an ever-increasing process of organically managed retreat. Organic managed retreat is when a business, farm, or homeowner has been flooded out, burned out, droughted out, smoked out, etc., so often that they cannot go through the emotional, psychological, and financial process of rebuilding one more time. 

They have finally reached the point where they no longer expect different climate change consequences in the future, given the already prevalent climate change emergency in medium to high-risk areas. They are exhausted from this repeated loss and rebuilding process, or trying to collect from insurance companies desperate to get out of the climate change business, or from dwindling government emergency relief funds with endless red tape taking years to collect.)

Without the four above government guarantees, no amount of legal action could be sustained through the court systems that could force insurance and reinsurance businesses to act in a way that would destroy those businesses. Do not be surprised to soon hear about stockholders in these insurance and reinsurance companies demanding the firing of any senior-level executive dumb enough to keep the insurance or reinsurance company in the property insurance business of covering well-known and rapidly accelerating climate change consequence risks.

To exacerbate the climate change insurance and reinsurance crisis, more traditional mortgage insurance companies are also entering this market, adjusting their policies and refusing to provide mortgages for climate change medium to high-risk areas, or by significantly increasing their mortgage rates. These related home, business, and mortgage insurance cancelations or radical rate increases will eventually result in severe real estate and business and farm losses in all climate change medium to high-risk areas because homes, buildings, or farms will be tricky to impossible to sell without being able to secure mortgage insurance or obtain home, business or farm insurance. Uninsurable homes, businesses, and farms will sell at a small fraction of their pre-cancellation value.  

Insurance and reinsurance companies, on their own, are already abandoning their previous and currently near-useless 100-year floodplain, wildfire, and extreme weather risk charts. They are creating their own 1,000-year or 10,000-year floodplain, wildfire, and extreme weather risk charts that better reflect current and future climate change risks. These new 1,000- to 10,000-year charts will result in insurance and reinsurance companies dramatically and rapidly expanding their climate change no-insurance zones to stay ahead of the rapidly accelerating consequences of climate change.

These new 1,000 to 10,000-year risk charts are critical for protecting insurance and reinsurance companies from bankruptcy and unfairly having to pay for the known accelerating consequences and risks of climate change caused by the global fossil fuel cartel's toxic carbon and methane atmospheric pollution. The risk departments at insurance and reinsurance companies already know with very high certainty that the destructive impacts of climate change consequences will rise dramatically from now until 2031 and, after that, exponentially.

Additionally, insurance and reinsurance companies are legally digging in. They legally claim they did not cause the highly preventable climate change emergency if governments had done their due diligence and were not grossly negligent. They are also holding the legal position that climate change is not an act of God. They are vigorously forwarding the correct, fair, and legal position that climate change is a direct result of the long-term inaction and incompetence of state and national governments in regulating the toxic air pollution from burning fossil fuels.

Insurance and reinsurance companies aggressively maintain the legal position that state and national governments have failed for over 60 years to regulate the escalating toxic carbon and methane pollution of the global fossil fuel industry and manage the well-documented rising climate change risks and global warming threat. They are also claiming that because the global fossil fuel cartel has spent billions on proven global climate change disinformation and misinformation that the government has failed to manage or correct, they are not responsible for the consequences of climate change. They refuse to become the financial "fall guys" for the known and intentional destructive acts of others. Click here to see the documentation on the massive global disinformation and misinformation program funded by the global fossil fuel cartel.

Not unlike corporations, which are held legally responsible for their negligence or harmful acts, insurance and insurance companies are taking the legal position that state and national governments (along with the global fossil fuel cartel) are also fully responsible for paying for all of the consequences of climate change because of their decades of unconscionable failure to set and enforce climate change regulations to prevent the climate consequences and losses we are now experiencing.

Suppose state and national governments continue to try to force insurance and reinsurance companies to maintain coverage in medium to high-risk climate change areas (as they are already doing in some areas). In that case, insurance and reinsurance companies will find legal and other ways to raise rates astronomically. Hence, they never lose money, regardless of how much the consequences of climate change accelerate. Insurance and reinsurance companies have painfully realized they have no choice but to continually skyrocket insurance rates or rapidly cancel home, business, and farm property and mortgage policies in all climate change medium—to high-risk areas to prevent them from going bankrupt for a highly predictable and preventable human-made problem.

Accelerating climate change is a known no-win crisis for global insurance and reinsurance companies. Skyrocketing insurance rates or cancellations are already causing a rapidly expanding global insurance coverage crisis. Soon, this climate change-fueled insurance crisis will also cause a real estate and business crisis.

State and national governments attempting to unfairly force insurance companies to maintain coverage in medium- to high-risk areas affected by climate change will prove to be just another failed government policy, not unlike their failure to regulate the toxic air pollution of fossil fuel companies, which contributes to our current climate change.

Politicians, states, and national governments are establishing property insurance coverage for homes, businesses, and farms in medium— to high-risk areas that are likely to experience climate change-related failures.

Because many insurance and reinsurance companies globally are already refusing to cover climate change risks in medium—to high-risk areas, no matter what the state or government threatens, many states and governments have started their own climate change-related property insurance funds. The problem with these state-run funds is that they are grossly underfunded and will never be able to keep up with the ever-rising costs of accelerating climate change consequences.

Those homeowners, businesses, and farms that depend on and pay for these government-run policies as property insurance of last resort will receive only a fraction of what was promised, as climate consequences worsen. These state-run, underfunded insurance policies will eventually collapse, and those who paid into them will lose everything. 

Currently, the state-run climate change insurance funds have no required minimum cash reserve levels, and they are grossly underfunded. A notable example of these poorly conceived, underfunded state-run climate change insurance funds is the brainchild of California Governor Gavin Newsom and his climate change advisory team. It appears that our politicians will do anything but confront the facts of the climate change emergency and immediately enact and enforce the correct fossil fuel use reductions needed to save humanity from climate change chaos and widespread extinction.

Over the next 10 years, one in 10 homes and businesses in high and medium-risk climate change areas are predicted to become completely uninsurable. This will result in massive losses for the real estate and farming industries. At its very best, governments attempting to force insurance coverage will only result in exorbitant premiums that no one can afford, except billionaires. 

The bottom line for insurance and reinsurance companies is that they will soon go bankrupt if they continue to accept or extend property insurance coverage to homes, businesses, or farms in medium—to high-risk climate change areas. Not only will they go bankrupt, but they will increase their staff's property policy servicing costs before they do. Climate change-related property insurance risks have become the ultimate no-win market segment for the insurance and reinsurance industry.

Ironically, with increasing insurance cancellations and soaring rates in high-to-medium-risk climate change areas, the insurance and reinsurance industries have become the most significant single force for reversing global climate change denial. Climate change-related insurance and reinsurance cancellations, as well as soaring rates, have become an increasingly powerful motivator for governments and politicians to acknowledge the reality of climate change and take the necessary and honest steps to reduce fossil fuel use worldwide. 

For decades, no government, nonprofit organization, or mass climate change protest has been as effective as the insurance and reinsurance industries in removing the fossil fuel's toxic pollution and profit incentives that relate directly to their climate change consequences. As inadvertent advocates for humanity's survival and rationality regarding climate change, the world and future generations will increasingly recognize, applaud, and honor the business wisdom and heroism of the stockholders, executives, and staff of the world's insurance and reinsurance industries. 

By steadfastly protecting the profitability of their businesses, they are also protecting humanity's future. In this area, it finally appears that traditional market forces will have a robust and continually growing profitability-controlling effect to help eliminate the toxic pollution and other climate change damages of the global fossil fuel cartel that directly fuels the accelerating climate change emergency.

Definitely click here for another detailed article on this accelerating wave of insurance rates and cancellation problems. It covers the intense financial fallout that these insurance rate increases and cancellation problems will cause in other critical industries, as well as the growing difficulty in obtaining home, business, or farm mortgage insurance in rapidly growing climate change medium to high-risk areas. It also covers in its documentation the uncensored climate change research, forecasts, and analysis that the most innovative insurance and reinsurance companies use in their climate change risk evaluation departments. The uncensored information they are using is not anything like what you are hearing in the media, from your government, or the UN IPCC.

 

 

In summary

Accelerating climate change is a well-known no-win crisis for global insurance companies. Skyrocketing insurance rates or cancellations are already causing a rapidly expanding global insurance coverage crisis. Soon, the climate change-fueled insurance crisis will also cause a real estate and business crisis.

State and national governments forcing insurance companies to maintain coverage in medium to high-risk climate change areas will become just another failed government policy, not unlike their failure to regulate the toxic fossil fuel pollution of fossil fuel companies, causing our current climate change.

At its very best, governments attempting to force insurance coverage will only result in exorbitant premiums that no one can afford, except billionaires. 

Paradoxically, it may be the world's insurance companies that finally make people become aware of the painful REAL costs of decades of climate change inaction, incompetence by our governments, and the paralyzing consequences of the global fossil fuel cartel's billion-dollar disinformation campaigns.

For more information

To view a comprehensive list of highly predicted and already occurring climate change-related consequences that are terrifying the global insurance industry, click here.

Click the following link for more about the massive fossil fuel cartel climate change disinformation programs that have grossly corrupted the climate change information currently being used by governments, corporations, the media, and even the UN's  IPCC climate change summary reports.

Click the following link to learn more about how the correct global fuel reduction requirements, climate change consequence severity, and climate consequence timetables have been underestimated by about 20-40%.

We are losing the climate change battle. Click here to learn about how to protect yourself from the escalating climate change consequences emergency.

Click here for another detailed article on this accelerating wave of insurance problems and the growing difficulty in obtaining home and mortgage insurance in quickly growing climate change high-risk areas. 

About the author of this article

Job One for Humanity, founded in 2008, is a non-profit, 100% publicly funded, independent climate change think tank that provides a holistic and "big picture" overview of climate change. It provides an uncensored, dialectical, meta-systemic, and systems theory-based analysis of the interconnected and interdependent climate systems and subsystems that create the current climate change and global warming emergency. 

Job One for Humanity supplies science-grounded climate change consequence analysis, timeframes, risk assessment, and solutions to educational, climate, and environmental organizations worldwide without charge. Job One is part of a 30-year-old US IRS-recognized tax-exempt nonprofit organization. 

 

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