By DAN REYNOLDS, senior editor of Risk & Insurance®
U.S.-based insurers in 2009 are going to be entering into a new era of disclosure of their climate change risks, thanks to the National Association of Insurance Commissioners, which is finalizing a climate risk disclosure survey.
The survey is going to call for mandatory disclosure of climate change risks for insurers with more than $500 million in premiums.
In 2010, insurance regulators in all 50 states will require that insurance companies with premiums of more than $300 million report their climate change risks to their state regulators.
Sean Dilweg, the commissioner of the Wisconsin Department of Insurance who is chairing the NAIC's Climate Change and Global Warming Task Force, said the eight-question survey is meant to be a stepping stone to future, more detailed responses.
"I do want to see this work," said Dilweg.
"I want to see continuity as it is implemented, get a chance to get the responses and see where there might be more issues. I recognize that this needs to work for a period of years before we take the next step," he added.
In asking for climate change risk information, Dilweg and his fellow commissioners on the task force are trying to be sensitive to the competitive concerns of insurance companies.
Insurers will not be required to provide information they feel is "sensitive or proprietary," according to a draft of the survey.
Dave Snyder, the general counsel for the American Insurance Association, who has been active in dialogues with the NAIC over the content of the survey, said he feels substantial progress has been made in what kind of information state regulators will seek.
"It looks workable, and it looks effective in terms of meeting the legitimate needs of consumers and regulators," Snyder said.
Dilweg said the NAIC should arrive at final approval of the climate risk disclosure survey by February or March.
Those insurers receiving the surveys in 2009 will have until May 2010 to supply the required information.
January 1, 2009
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