Reports from U.S.-based Group Will Examine Impacts of Climate Change on Terrorism

November 4, 2021 by

A new global partnership with the National Consortium for the Study of Terrorism and Responses to Terrorism will focus on the impact of climate change on terrorism.

START, which is based at the University of Maryland, with the cooperation of the International Forum of Terrorism Risk (Re)Insurance, a global terrorism pools forum, and Pool Re Solutions, announced it will produce a series of reports underlining the impact that climate change is having on the drivers of terrorism.

The reports will examine the current and contemporary threats and global regional outlooks.

The research, which is expected to also provide possible actions and recommendations of how to mitigate the risk, will be presented at the next IIFTRIP meeting in Washington D.C. in May 2022.

Terrorism has implications for the insurance industry, governments and others interested in the issue of resilience, according to the groups.

The groups hope the study will provide data and analytics to measure and define the likely impacts of climate change on the terrorism landscape.

“This study represents a critical and pragmatic contribution focused on implications for human and economic security,” Bill Braniff, START director, said in a statement. “In truth, we are already observing violence, criminality, and terrorism brought about directly and indirectly by climate change; this study will therefore serve as a call to action on an urgent issue.”

Allianz Group and International Finance Corporation (IFC), a member of the World Bank Group, have signed a partnership under the Managed Co-Lending Portfolio Program (MCPP). The new program, MCPP One Planet is the world’s first cross-sectoral portfolio of emerging-market loans aligned with the Paris Agreement.

IFC and Allianz Group

Allianz Group and International Finance Corp., a member of the World Bank Group, announced a partnership under the Managed Co-Lending Portfolio Program called MCPP One Planet, which the organizations called “the world’s first cross-sectoral portfolio of emerging-market loans aligned with the Paris Agreement.”

The agreement is expected to yield a new global platform for “climate smart-investment” that will provide up to $3 billion to private enterprises in developing economies. Investor contributions will be combined with IFC’s own funds to scale up climate-responsible financing in emerging markets.

“Our strong partnership with IFC and other engaged investors enable us to shape programs like MCPP One Planet and contribute to climate-smart economic growth in markets at scale,” Oliver Bäte, CEO of Allianz SE, said in a statement. “Huge sums need to be invested to bring emerging markets along a Paris-aligned trajectory, and we are keen to help structure these public-private collaborations and mobilize the required capital.”

MCPP One Planet was announced at the ongoing international climate conference COP26 in Glasgow.

Commissioners on Climate

The nation cannot insure its way out of coming climate disasters, and it must focus on mitigation and resiliency to reduce risk and exposure, insurance regulators said Wednesday.

Insurance commissioners from around the country joined a virtual meeting, “How are U.S. insurance regulators taking action on climate change risks,” held as part of the United Nations’ Climate Change Conference, now under way in Scotland.

The commissioners offered few tangible regulatory changes, but they discussed initiatives are under way at the national, state and local levels, according to an article by Insurance Journal Southeast Editor William Rabb.

The commissioners new model rules and insurance products being explored by the National Association of Insurance Commissioners designed to help ensure carriers are better able to manage catastrophes as storms intensify. One idea is automated payments after a triggering event, and another is expanding the use of parametric insurance to fill coverage gaps.

“There are some regulatory concerns about how these products are designed and whether consumers fully understand how the coverage works,” said Ray Farmer, insurance director for South Carolina. With the right structure and transparency, however, parametric products can help policyholders recover more quickly from a disaster, he added.

Insurance Leadership

Insurers have “lost their leadership” on the climate change topic, according to a new report from a climate advocacy group.

The Insure Our Future campaign’s fifth annual report on the industry’s response to climate change says insurers have lost their leadership role on the topic, though it acknowledged that the global industry has taken “swift action” against new coal projects.

The report calls out major U.S. companies such as AIG and international specialty insurers for continuing to “prop up coal.”

While reinsurers have begun removing coal from their treaties, the industry isn’t doing enough to prevent the growth of oil and gas production, according to Insure Our Future.

“So far, only Generali has adopted policies to stop cover for most or all new oil and gas production projects, although 14 insurers have now restricted cover for tar sands,” the report states. “Numerous insurers from North America, Europe and Asia continue to underwrite the expansion of the oil and gas industry without any restrictions.”

According to the report, since 2017, 35 insurers have withdrawn cover for such projects, which represents 14.3% of the market for primary insurance and 54.5% of the market for reinsurance. That’s up from 23 insurers with market shares of 12.9% and 48.3% respectively one year ago, the report shows.

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