Few would give the Bank of England top marks for being ahead of events when the credit crunch began. Having been slow to respond to one global disaster, it is determined not to be caught flat-footed in another. To this end its Prudential Regulation Authority has written to 30 large insurers to probe the robustness of their business models in the face of extreme weather.
信贷危机发生时，英国央行(Bank of England)对事态作出的反应不是十分令人满意。在一场全球性灾难中反应迟钝的它，决心不能再毫无准备地面对另一场全球性灾难。为此，该行旗下的审慎监管局(Prudential Regulation Authority)致函30家大型保险公司，想探知在遭遇极端天气时它们商业模式的稳健性。
Insurance companies may well feel like rolling their eyeballs at being prodded in this way. They were at the sharp end when events like Typhoon Haiyan or Hurricane Katrina caused a huge increase in insurance claims.
In 2012, weather-related disasters cost about $150bn, of which over a third was insured. People who only see the sunny side of life seldom rise far in the insurance industry. With exposures lasting decades, most insurance CEOs will claim to have thought deeply about the risks posed by extreme weather to their business.
Yet there are good reasons for the Bank of England to turn up the volume. The main one is the tussle between regulator and industry over the levels of capital needed to insure certain risks. Anything related to climate needs to be examined regularly. UK rules demand that insurers have enough capital on hand to withstand the sort of shock that only happens every 200 years. This is a high bar, but appropriate given that global temperatures may within decades hit levels not seen since the prehistoric era.
Moreover, the methods used to evaluate climate change risk are likely to be highly idiosyncratic, which provides another good reason for the Bank’s interference. The manner in which global warming may be influencing the weather is difficult to ascertain, potentially covering events from floods and hurricanes to droughts and loss of biodiversity. Evaluating future risks will require even more guesswork. While markets are meant to incorporate a variety of opinions, high regulatory standards are needed to stop a casual attitude to climate change becoming a competitive advantage.
Higher capital requirements come at a cost. Either premiums must rise or some markets are rendered unviable. Already the insurance companies blame tough regulation for limiting their ability to invest in more growth-enhancing areas of the economy.
Any regulatory change that would leave swaths of coastal property uninsurable brings excruciating political dilemmas. When once-secure dwellings become at risk of subsidence and flooding, the government faces an awkward choice: between building better defences, abandoning householders to a loss of affordable insurance or subsidising cover that is not economic on its own terms. Sometimes abandonment will be the right answer; it makes no sense to put down bricks and mortar that will be regularly submerged in floodwater.
Insurance will play a key part in the response to global warming. First, it must support the activities needed to adjust to and mitigate the effects of climate change. But it should also send clear signals about what will not be insurable, and where state support may be required.
After the heaviest rainfall in a century, this year’s squabbles between industry and government about how to keep Britain’s coastal areas viable are a foretaste of what is to come. It would have been better had this happened in a strategic way, and before rather than after the next extreme weather event.
US insurance companies have been accused of being ill prepared for climate change. This makes it doubly encouraging that the Bank of England is determined to be on the front foot.