Insurance industry is leaving home and business owners (and cities) in the dust by pulling out of high-storm areas.

A new report by nonprofit environmental coalition Ceres says the insurance industry is shunning Florida markets because of increased storm activity, while insurers have done little to prepare for climate change.

The Ceres report is littered with references to insurers applying special conditions to Florida. Excerpts from the report:

• Several insurers describe screening out securities or real assets from coastal regions (particularly Florida) and arid regions with perceived water scarcity such as the Southwest. Particularly following the spate of destructive storm and drought activity in 2012, these investment screening practices should be noted by real asset owners and bond issuers.

• Already, divestiture from coastal counties and municipalities is a reality. This ranges from simple embargos like that adopted by Hudson Insurance Company (“We have determined not to buy State of Florida bonds,”) to more general policies.

• Torchmark Group said in its survey response, “In response to the potential for major catastrophe losses, the companies have not purchased investments such as Florida Windstorm bonds, Oil Casualty bonds, etc. We continuously monitor conditions in all sectors that are, or could be, affected by future climate developments.”

Great built environment news from the Middle East. They’re getting into disaster management (and a bit of climate adaptation). The conference was held last month in Aqaba, Jordan. And you can view and download a boatload of power point presentations by the speakers, here.

Not sure how long the resources will be online, so get them while they last! 

The conference will provide a forum for Arab politicians, policy makers, planners, academia and development experts to discuss issues and challenges facing the region with regard to disaster risk reduction. This session is being co-organized by the United Nations Office for Disaster Risk Reduction (UNISDR), the United Nations Development Programme (UNDP), the Hashemite Kingdom of Jordan, the Aqaba Special Economic Zone Authority (ASEZA), the Swiss Development Cooperation (SDC) and the League of Arab States (LAS).

Wants to include climate change risks in environmental permits. When you build something, such a house or store, you typically need a permit (or three) from the local or state government. Bigger projects require federal approval, such as an oil pipeline or a rail line. So, the larger the project, the more information the government requires as part of those permits.

In order to get a permit, you need to conduct some studies and write a few reports, typically these include an economic feasibility and an environmental impact statement. For federal permits, these studies are made public. This “public comment period” gives everyone, including other businesses, a chance to voice their opinions on the project.

Now, Obama wants to change the rules. He is proposing that the federal permit process should include risks and impacts from climate change. These climate risks will be part of the environmental impact statement.

Businesses do not like permits - but not for the reasons you’d expect. It’s very expensive to conduct the required economic and environmental studies. Businesses have to hire specialists just for these permits. Often, these studies delay projects, which makes the projects more expensive to build.

The biggest complaint is that rules are inconsistent - they’re difficult to comply with, unclear in their intent, guidelines are always changing, and (worst of all) they’re unevenly enforced. Sometimes a politician will intervene - essentially subverting the law. Political intervention creates an atmosphere of unfairness and favoritism (but, that is discussion for another post).

In the permitting world, lawsuits abound. And lawsuits compound the costs of building and it generally pisses off a lot of people.

So, when you hear complaints that “environmental permits hurts jobs” it’s not that the developer hates the environment, it’s that the rules are a convoluted, expensive mess. It’s also a clever way for politicians to dismantle environmental regulations because, after all, the rules “hurt jobs” - a line that resonates with the voting public.

Thus, from the perspective of business, Obama’s proposal to increase the rules for environmental permits has businesses - and the politicians that they’ve bought - shaking in their boots.

Queue a big political fight on this one.

President Barack Obama is preparing to tell all federal agencies for the first time that they should consider the impact on global warming before approving major projects, from pipelines to highways.

The result could be significant delays for natural gas- export facilities, ports for coal sales to Asia, and even new forest roads, industry lobbyists warn.

“It’s got us very freaked out,” said Ross Eisenberg, vice president of the National Association of Manufacturers, a Washington-based group that represents 11,000 companies such as Exxon Mobil Corp. (XOM) and Southern Co. (SO) The standards, which constitute guidance for agencies and not new regulations, are set to be issued in the coming weeks, according to lawyers briefed by administration officials.

In taking the step, Obama would be fulfilling a vow to act alone in the face of a Republican-run House of Representatives unwilling to pass measures limiting greenhouse gases. He’d expand the scope of a Nixon-era law that was first intended to force agencies to assess the effect of projects on air, water and soil pollution.

“If Congress won’t act soon to protect future generations, I will,” Obama said last month during his State of the Union address. He pledged executive actions “to reduce pollution, prepare our communities for the consequences of climate change, and speed the transition to more sustainable sources of energy.”

Via the excellent Bloomberg.com

Pretty good pulse-taking by Bizweek.

Now some investors are taking another approach. Working under the assumption that climate change is inevitable, they’re investing in businesses that will profit as the planet gets hotter. (The World Bank says the earth could warm by 4C by the end of the century.) Their strategies include buying water treatment companies, brokering deals for Australian farmland, and backing a startup that has engineered a mosquito to fight dengue, a disease that’s spreading as the mercury climbs.

Derivatives that help companies hedge against abnormal weather and natural catastrophes are drawing increased interest from some big players. In January, KKR (KKR) bought a 25 percent stake in Nephila Capital, an $8 billion Bermuda hedge fund that trades in weather derivatives. (The firm is named after a spider that, according to local folklore, can predict hurricanes.)

“Climate risk is something people are paying more and more attention to,” says Barney Schauble, managing partner at Nephila Advisors, the firm’s U.S. arm. “More volatile weather creates more risk and more appetite to protect against that risk.”

Drought is helping spur business at Water Asset Management. The New York hedge fund, which has about $400 million under management, buys water rights and makes private equity and stock market investments in water treatment companies. “Not enough people are thinking long term of [water] as an asset that is worthy of ownership,” says Chief Operating Officer Marc Robert. “Climate change for us is a driver.”

Via Business Week

So glad to see RT pick this story up. Infrastructure is what I work on, and the U.S. is in big, big trouble.

rtamerica:

Inspectors discovered 326 deficient levees across the US, whose likely failures could leave millions of people dead.

A breach could demolish homes and cost local governments millions of dollars. By failing to repair the defective structures, the US is choosing to risk the lives of its citizens who are walking on eggshells with their proximity to the flood zones. In its first ever inventory of the nation’s flood control systems, inspectors raised the overdue alarm that hundreds of levees may be unable to regulate water levels and prove useless in face of heavy rains. Such populated cities as Washington DC, Sacramento, Dallas, Cleveland and many others might be flooded at any moment.

The US Army Corps of Engineers has only issued ratings for 58 percent of the 2,487 flood control systems, which means inspectors could still discover hundreds more deficient levees. Many of the earthen levees are crumbling under the effect of trees, shrubs and animal holes. Decaying pipes and pumping stations could also cause the flood control systems downfall, while some of the levees are dangerously close to houses or even have houses built on top of them.

I devoured Lord Stern’s now famous report six years ago (has it been that long!?). At the time Stern’s report was very controversial. It focused primarily on the economic impacts from climate, and had included some incredibly high numbers. It was widely thought to be out-of-touch with reality - that his numbers were wildly overestimated and his analysis of the models was flawed. True, this reception has softened somewhat over the years.

Now Stern says he didn’t go far enough.

Lord Stern, author of the government-commissioned review on climate change that became the reference work for politicians and green campaigners, now says he underestimated the risks, and should have been more “blunt” about the threat posed to the economy by rising temperatures.

In an interview at the World Economic Forum in Davos, Stern, who is now a crossbench peer, said: “Looking back, I underestimated the risks. The planet and the atmosphere seem to be absorbing less carbon than we expected, and emissions are rising pretty strongly. Some of the effects are coming through more quickly than we thought then.”

The Stern review, published in 2006, pointed to a 75% chance that global temperatures would rise by between two and three degrees above the long-term average; he now believes we are “on track for something like four “. Had he known the way the situation would evolve, he says, “I think I would have been a bit more blunt. I would have been much more strong about the risks of a four- or five-degree rise.”

He said some countries, including China, had now started to grasp the seriousness of the risks, but governments should now act forcefully to shift their economies towards less energy-intensive, more environmentally sustainable technologies.

“This is potentially so dangerous that we have to act strongly. Do we want to play Russian roulette with two bullets or one? These risks for many people are existential.”

The Guardian

law-news:

Hurricane Sandy left a trail of destruction across the entire Eastern United States, wreaking particularly violent havoc on New York City and the New Jersey coastline. 

Regardless of where you live, if you’re cleaning up damage left behind by the storm, you’re likely to have questions about recovery insurance coverage. And we have answers: 

• Preserving and Maximizing Insurance Claims in the Aftermath of Superstorm Sandy - Pillsbury Winthrop Shaw Pittman LLP 
• Good News for Homeowners: Insurers Cannot Charge Hurricane Deductibles - McCarter & English, LLP 
• Insurance Coverage for Businesses Affected by Hurricane Sandy - Perkins Coie 
• Superstorm Sandy: Are You Covered? - K&L Gates LLP 
• Practical Pointers for Protecting Your Insurance Rights in the Wake of Hurricane Sandy - Reed Smith 
• Reporting Insurance Claims From Damage Caused By Hurricane Sandy - Donald Scarinci 
• What Gilbert LLP Wants You To Know About Insurance Coverage For Superstorm Sandy - Gilbert LLP 
• Getting Help for Hurricane Sandy Destruction - Lawyers.com 

Find more insurance law news on JD Supra»

These diseases are caused by viruses, bacteria and parasites, and affect more than one billion people, mainly in the tropics, where the most vulnerable developing world populations are concentrated.

But the map of tropical diseases like malaria, Chagas’ disease, sleeping sickness, leishmaniasis, schistosomiasis and dengue fever, is starting to change.

Tropical diseases transmitted by vectors like mosquitoes, flies, ticks or snails are directly affected by conditions in the ecosystems they inhabit, such as changes in humidity, water levels, temperature or rainfall, experts explain.

“Global warming is ‘tropicalising’ subtropical regions; rising temperatures could bring an explosion of parasite and insect vectors that are expanding into North America, the Southern Cone of South America, Australia and New Zealand,” Costa Nery said.

One sign of this, said the president of the SBMT, is the spread of leishmaniasis in Europe by travelling persons and dogs. He explained that the disease, which is endemic in southern Europe, could continue to spread northward if temperatures keep rising.

At the same time, climate variation in the tropics and its effects on the frequency of flooding and drought “could also modify the dynamic of the transmission of diseases,” with the emergence of vectors that alter the population’s immunity and resistance.

Via IPS covering the 18th International Congress on Tropical Medicine and Malaria, held Sept. 23-27 in Rio de Janeiro.