If you live in a medium—to high-risk climate change consequence area, right or wrong, it’s only a matter of time before your insurance company skyrockets your rates or cancels your policy.
Accelerating climate change consequences and their huge insurance damage payouts have thrown the global insurance industry into financial chaos. This financial chaos in insurance has led many state and national governments to try to force insurance companies to maintain their coverage in areas with medium—to high-risk climate change consequences.
The “too little too late” government enforcement strategy is proving to be a terrible way to try to create insurance policyholder justice, and it will not solve the underlying problem. State and national governments forcing insurance companies to maintain climate change-related coverage in medium to high-risk areas is a fool’s errand with multiple worse outcomes.
If insurance companies are somehow forced by state or national governments to maintain insurance in medium to higher-risk climate change areas:
1. expect your home business and other location-related insurance premiums to rise quickly by 100 to 300 percent or even more. Or,
2. expect insurance companies to cancel all policies for homes, businesses, farms, autos, crop failure, and even some life insurance in most climate change medium to high-risk areas.
If state or national governments force insurance companies to maintain coverage in medium—to higher-risk climate change areas, insurance companies will also demand their “pound of flesh” in exchange for maintaining these extreme-risk coverages.
The insurance companies will demand that:
1. The government guarantees that the insurance companies can immediately raise their rates whenever they see the many different consequences of climate change increase. There would be no more once-a-year rate increases. Monthly rate increases would be allowed without requiring prior state or national approval. This guarantee would allow increasing insurance rates as much as needed to cover all additional climate change losses and a fair profit margin.
2. The government guarantees that insurance companies can use new 1,000—and 10,000-year floodplain, wildfire, and extreme weather risk charts.
3. State and national governments would allow independent climate change researchers to create these NEW 1,000 and 10,000-year charts because current climate change-related charts used by the US Geological Survey and governments around the world have been wildly distorted by the billions of dollars spent on climate change disinformation by the global fossil fuel cartel. Without further state or national approval, these new 1,000-year and 10,000-year risk charts will also allow insurance companies to also rapidly expand the definition and size of medium—and high-risk climate change areas. This would be critical to further control their risks and losses.
Currently, governments and global media coverage underestimate the correct global fuel reduction requirements, climate change consequence severity, and climate consequence timetables by about 20-40%. (This is also directly the result of the global fossil fuel cartel’s decades of climate change disinformation (and is explained here).)
The fossil fuel cartel’s massive climate change disinformation program has severely corrupted the climate change information currently being used by governments, corporations, the media, and even the UN’s IPCC climate change summary reports. Realizing this, insurance companies want to use only independent and uncensored climate change research and analysis that is unaffected by fossil fuel cartel disinformation or manipulation.
4. Guarantees that both the state and national governments will finally do their climate change management job and enforce the correct reduction regulations on toxic carbon and methane pollution from fossil fuel use. This is a critical governmental action to further reduce insurance company climate change risks and losses and maintain policy coverage.
5. Guarantees that the state or national governments will immediately establish adequate “Managed Retreat” buyback funds, funded by taxpayer contributions, to purchase all homes and businesses in climate change high-risk areas that will repeatedly be severely damaged or destroyed.
This is critical because the insurance claims payouts provided to damaged or destroyed homes and businesses in those high-risk areas would save repeatedly wasting valuable taxpayer and insurance company resources with no discernable future benefit. Financing Managed Retreat would be the full responsibility of state and national governments in part, to make restitution for their decades of unconscionable failure to protect their citizens from escalating climate change when the consequences were well-known over 60 years ago.
Without the above government guarantees, no amount of legal action will be sustained through the higher court systems that could force insurance businesses to act in a way that would most certainly destroy those very businesses.
And it gets much worse.
Because of the increasing global warming, soon, more traditional home and other mortgage companies will also jump into this insurance chaos and refuse to provide ANY home, business, or farm mortgages for climate change medium to high-risk areas or skyrocket their mortgage rates. These related home, business, and mortgage insurance cancelations or radical rate increases will eventually result in severe real estate and business losses in all climate change medium to high-risk areas. This will happen because homes, businesses, or farms will be very hard to sell without being able to secure mortgage insurance or obtaining the normal home, business, or farm insurances.
Insurance companies also know that climate change consequences are going to rise dramatically from now until 2031 and, after that, exponentially. On their own, insurance companies are rapidly abandoning their currently near-useless 100-year floodplain, wildfire, and extreme weather risk charts and are creating 1,000-year or 10,000-year floodplain, wildfire, and extreme weather risk charts that better reflect the actual current and future climate change risks. These new 1,000 to 10,000-year risk charts are critical for protecting insurance companies from bankruptcy and unfairly paying for the accelerating consequences and risks of climate change and global warming.
Additionally, insurance companies are digging in legally. They are taking the position that they did not cause the highly preventable climate change emergency and its damages. They are also holding the legal position that climate change is not an act of God. They are vigorously forwarding the legal position that climate change and global warming are a direct result of 60+ years of inaction and incompetency of state and national governments in regulating fossil fuel companies and fossil fuel use.
Insurance companies are refusing to become the financial “fall guys” for the known and intentional destructive acts of others. This position is not unlike corporations, which are held legally responsible for their negligence or harmful acts.
Insurance companies are also taking the legal position that state and national governments (along with the global fossil fuel cartel) are also fully and legally responsible for paying for all of the consequences of climate change because of their decades of unconscionable failure to set and enforce fossil fuel use regulations and to prevent the climate consequences and losses we are now experiencing.
If state and national governments continue to try to force insurance companies to maintain coverage in medium to high-risk areas (as they are already doing in some areas), insurance companies will find legal and other ways to keep raising rates astronomically so they never lose money and go bankrupt, no matter how much climate change’s consequences accelerate.
Because many insurance companies globally are aggressively canceling policies and refusing to cover climate change risks in medium—to high-risk areas, no matter what the state or national governments threaten, many state and national governments have started their own climate change-related insurance funds.
The big problem with these state-run funds is that they are grossly underfunded. Government-run climate change insurance funds also generally have no or minimal required minimum cash reserve levels.
Those citizens who depend upon and pay for these government-run and backed policies as their climate change insurance of last resort will get a fraction of what was promised as climate consequences continue to worsen. These state-run, underfunded insurance programs and policies will eventually collapse, and those who paid into them will lose everything in the next chain of climate change disasters.
A good example of poorly conceived, underfunded state-run climate change insurance funds is currently found in California. It seems politicians will always do the easiest “looks good” thing and not confront the actual facts of the climate change emergency and immediately enact and enforce the correct fossil fuel use reductions needed to save humanity from the growing climate change insurance chaos.
In summary
Accelerating climate change is a well known no-win crisis for global insurance companies. Skyrocketing insurance rates or cancelations are already causing a rapidly expanding global insurance coverage crisis. Soon, the climate change-fueled insurance crisis will also cause a real estate and business crisis.
State and national governments forcing insurance companies to maintain coverage in medium to high-risk climate change areas will become just another failed government policy, not unlike their failure to regulate the toxic fossil fuel pollution of fossil fuel companies causing our current climate change.
At its very best, governments attempting to force insurance coverage will only result in insane premiums that no one can pay but billionaires.
Paradoxically, it may be the world’s insurance companies that finally make people become aware of the painful REAL costs of decades of climate change inaction, incompetency by our governments, and the paralyzing consequences of the global fossil fuel cartel’s billion-dollar disinformation campaigns.
For more information
To see a master list of highly predicted and already occurring climate change-related consequences terrifying the global insurance industry, click here.
Click the following link for more about the massive fossil fuel cartel climate change disinformation programs that have grossly corrupted the climate change information currently being used by governments, corporations, the media, and even the UN’s IPCC climate change summary reports.
Click the following link to learn more about how the correct global fuel reduction requirements, climate change consequence severity, and climate consequence timetables have been underestimated by about 20-40%.
We are losing the climate change battle. Click here to learn about how to protect yourself from the escalating climate change consequences emergency.
Click here for another detailed article on this accelerating wave of insurance problems and the growing difficulty in obtaining home and mortgage insurance in quickly growing climate change high-risk areas.
About the author of this article
Job One for Humanity, founded in 2008, is a non-profit, 100% publicly funded, independent climate change think tank that provides a holistic and “big picture” overview of climate change. It provides an uncensored, dialectical meta-systemic and systems theory-based analysis of the interconnected and interdependent climate systems and subsystems creating the current climate change and global warming emergency.
Job One for Humanity supplies science-grounded climate change consequence analysis, timeframes, risk assessment, and solutions to educational, climate, and environmental organizations worldwide without charge. Job One is part of a 30-year-old US, IRS-recognized tax-exempt, nonprofit organization.
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