Action to manage climate change risks can help ensure that widespread insurance cover remains readily available, according to a report published last week by the Association of British Insurers.

A Changing Climate for Insurance, analyzes for the first time the practical implications of climate change for a key business sector and its customers. The report identifies the need for action by insurers and Government to manage climate change.

The report, prepared by Dr Andrew Dlugolecki, an international authority on climate change, highlights the impact that climate change is already having on the insurance industry, notably in changing patterns of claims arising from a greater incidence of extreme weather. It points to the need for a partnership approach between industry and the U.K. government to prepare for the effects of climate change.

The report highlights the effects that changing weather patterns are already having:

• in the 1990’s there was a significant increase in the number of months of both extreme hot and wet weather. During this decade there were 34 months of extreme hot weather, compared to a previous average of just 12 months per decade.
  
  
• the number of winter storms crossing the UK has doubled in the last 50 years;
  
  
• Weather-related claims on property insurance have doubled to over £6 billion between 1998 to 2003, compared with the previous five years. The report predicts that claims could treble if no action is taken.
  
  Other sectors of insurance, such as health, motor and liability insurance could also be influenced by changing weather patterns.
  
  “Managing the impacts of climate change is a major challenge for society – we already live with its effects everyday”, said John Parker, the ABI’s Head of General Insurance. “Insurance is in the front line of climate change. Managing risk is central to our industry, and insurers must be equipped to analyse the new risks arising from climate change, and to help customers protect against them. “This report provides the industry with a platform to ensure that appropriate action is taken by insurers, Government and other stakeholders to effectively manage climate change.“