Actuaries Index: Extreme Climate Conditions Hit New High in Winter 2019-20

August 27, 2020 by

A multiyear trend of increasing climate condition measurements from the U.S. and Canada hit a new high in winter 2019-2020, according a new Actuaries Climate Index released this week.

The quarterly data’s key metric of a seasonal five-year moving average comes up with a number that represents a composite measure of long-term changes across an array of observed weather extremes and sea levels in both countries.

Extreme climate conditions tracked by the index include high and low temperatures, heavy rain, drought, high wind and sea level.

The index has climbed steadily from its most recent cyclical low of 0.70 in 2015 to a new high of 1.17 for the moving average in winter 2019-20. While the latest increase in the moving average is marginal, it is 0.07 above the previous winter and reflects that the extreme climate conditions tracked by the index continue to move away from the reference period norms since inception in 1961.

“The ACI’s five-year moving average is a composite value reflecting the consistently growing change in measured values for the heavy rainfall, sea level, and extreme high and low temperature components that are fueling the overall trend toward extreme conditions seen in the latest data,” Doug Collins, chair of the Climate Index Working Group, said in a statement. “While we should not expect the five-year average to always increase, if changes in climate indicators continue on their current course, the general trend in the Actuaries Climate Index is likely to be upward.”

The index is based on analysis of seasonal data from scientific sources for six index components collected since 1961. The index measures changes in these components for the U.S. and Canada combined and by region. Combining six components over a five-year measurement period, the index’s moving average smooths out monthly and seasonal fluctuations for a meaningful measurement of long-term climate trends.

The index is sponsored by the American Academy of Actuaries, the Canadian Institute of Actuaries, the Casualty Actuarial Society and the Society of Actuaries. It is designed to provide actuaries, public policymakers, and the public with data about changes in the frequency of extreme climate conditions.

Australia & Climate

Australia is “woefully unprepared” for the scale of the climate change threats, and the nation suffers from a public debate focused too much on the cost of action rather than the costs of failing to act, according to a coalition of environmental and business groups.

“There is no systemic government response (federal, state and local) to build resilience to climate risks,” according to a paper published by the Australian Climate Roundtable.

The Roundtable is calling for climate change to be made a standing item for National Cabinet and for Australia to “play our fair part in international efforts” to keep global warming in check by pushing for net zero emissions, the Sydney Morning Herald is reporting this week.

The paper states that Australia will experience escalating costs from climate change that will “be significant and will require a concerted national response to manage these now unavoidable climate related damages.”

A report released last month calls out Australia as one of many nations where rising sea levels already are leading to more frequent and extreme flood events.

The Herald quotes environment minister Matt Kean as saying that for too long climate change politics had been simplified to either stoking fear about the cost of reducing emissions or inciting guilt for living in a modern economy which emits carbon.

“It is time that debate moved on. The science is in, climate change is already taking a toll on our country,” he said. “The reality is that the world is moving to low carbon economies with ratings agencies, global investors and our trading partners looking to reduce their emissions.”

Maryland Tides

Chesapeake Bay waves have eaten away at the land, while the evidence of rising seas stretches to Dorchester County’s mainland toward the county seat of Cambridge, where across the rural southern half of the county, everything is projected to be inundated frequently by the end of the century.

Across Dorchester, shores have receded by as much as 600 feet since the 1970s, and they continue to lose ground each day, according to experts.

The signs of change are so glaring around Dorchester, they are forcing difficult decisions. In the county of 32,000 people, experts say the confrontation with rising water caused by climate change is coming more quickly than just about anywhere else on the East Coast, according to an article this week in Insurance Journal.

“Dorchester County is a good example of our canary in a coal mine,” said Michael Scott, dean of the Henson School of Science and Technology at Salisbury University, who has spent years mapping land losses in the county. “These same issues are coming to a county near you. It’s just a matter of when or where.”

Dorchester County homebuyers have to increasingly pay in cash to avoid the skyrocketing flood insurance premiums that mortgage lenders require, while road closures are routine as high tides jump riverbanks and rise through storm drains.

There is also talk of curtailing any new development across southern Dorchester, even as there’s also discussion of extending sewer lines to far-flung communities where a rising water table threatens widespread septic system failures, according to the article.

Laura And Climate Change

Hurricane Laura’s top wind speeds nearly doubled in just 24 hours as it approached the border between Texas and Louisiana on Thursday. The wall of water it pushed in front of it grew until forecasters warned that it would produce “unsurvivable” storm surge.

Hurricanes like Laura are more likely because of climate change, NPR is reporting in an article.

“Laura’s rapid intensification is one hallmark of climate change,” the article states. “As the Earth warms up, the water on the surface of the ocean gets hotter. Hot water is like a battery charger for hurricanes; it send energy and moisture into the storm as it forms and helps it grow more powerful and deadly.

It quotes meteorologist Jeff Masters, who said, “The proportion of all hurricanes reaching Category 4 and 5 strength has increased in recent years,” and references a study last year that found that storms are more likely to become major hurricanes very quickly – the last two major hurricanes to affect the Gulf Coast were Hurricane Harvey in 2017 and Hurricane Michael in 2018, both of which intensified rapidly before they made landfall.

The water in the Gulf of Mexico right is nearly 90 degrees Fahrenheit in some places.

“This is concerning because hurricanes that rapidly intensify before landfall are the hardest ones to prepare for,” says Masters, because there is less time for people to evacuate or find local shelters than can withstand highly destructive wind speeds.

Hurricane Laura will affect a large swath of the central and eastern U.S., while rain-driven flooding could stretch thousands of miles, according to NPR.

Ratings analysts A.M. Best and Moody’s are expecting property/casualty insurers and reinsurers to suffer meaningful losses from Hurricane Laura.

A.M. Best expects losses from Hurricane Laura to place added stress on its rated insurance companies’ balance sheets, which it adds have already been weakened by the COVID-19 pandemic.

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