Insurers raise cry for help as climate disasters pile up in U.S., Europe
Plus, the 'big stick' of Trump's tariffs roils markets
In today’s edition:
— Insurers raise cry for help as climate disasters pile up in the U.S, Europe
— Climate stocks on wild tariff ride as Trump tornado enters third week
— Giant iceberg bears down on British territory, threatening remote wildlife haven
— Eleven hundred EPA workers told they could be fired as Musk wields jobs axe
— Climate change helping rat populations grow in major cities
Flood of opposition: President Donald Trump on Sunday ordered all federal agencies to maximize water deliveries. In central California, the Army Corps of Engineers prepared to increase flows from Lake Kaweah but scaled back after local water managers said it would cause flood damage to farms and communities. Above, Terminus Dam at Lake Kaweah in Tulare County. Photo: Chris Gray/USACE.
The pullback among insurers in recent years doing business in climate trouble spots in the U.S. and Europe is turning into emergency cries for help as disaster damages such as the LA wildfires wreak unprecedented havoc.
State Farm, the largest insurer in California, asked the state for an emergency rate hike of 22% this week, citing a “dire situation” for policy holders as the claims from the wildfires pile up. Although a 30% hike request is still sitting with California lawmakers from last summer, State Farm is hoping the emergency request will cut through red tape to help salvage its California business.
The warning came as Europe’s top insurance regulator warned that impending disasters threatened financial chaos to the system if insurers can’t handle them and need to pass the damage to banks and governments. Petra Hielkema told the Financial Times that the cost of droughts and storms in Europe such as the Spanish floods last year has more than doubled over a decade ago.
Policyholders won’t be too sympathetic to insurers, many of whom still posted record profits last year. But the trend and the recent cries for help should not be ignored. Government coffers are ill-prepared to cover losses that insurers do not, and there is potential for the damage to spread in financial markets, particularly to municipal bond markets.
California is a testing ground for other climate trouble spots such as Florida or Texas, and the rest of the country. How governments respond will be closely watched by investors, and especially policyholders. . . .
Don’t forget to contact me directly if you have suggestions or ideas dcallaway@callawayclimateinsights.com.
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Climate stocks on wild ride as Trump tornado enters third week
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