Climate change reality for business
Climate change ranks highly in surveys of business leaders’ concerns but are they just considering a concept or the actual risk to their operations? Headline stories such as ‘rising sea levels’ and ‘coastal land lost to floods’ are dramatic and worrying, but some see these risks in the future and not directly affecting their business. Recent reports highlight the issues, many of which are happening now. The cost of the harsh North American winter for example; productivity and lost business were more of an issue than property damage. Higher average temperatures could force changes in working arrangements, for example for those who work outside, with associated cost increases. Then there are the logistics of staff getting to work in adverse weather conditions and of delivery and service vehicles affected by the changing climatic conditions. For businesses that do not believe that they need to act now to prepare for environmental risk, the figures offer stark warning; in 2012 weather-related incidents worldwide caused $130 billion in damage.
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Asian insurers poised to invest heavily in real estate
Relaxation of regulations in some Asian countries is likely to see insurance companies there investing heavily in real estate in the US. Global realtors CBRE report that with greater financial freedom, Asian insurers will put their money into property in key targets such as New York. The insurance market is booming in many Asian countries, as prosperity increases demand for life, home, motor and health cover. Businesses are increasing spend on insurance products too, especially with growing global trade. In China for example, there has been a 20 per cent rise in policies in the last 5 years.
Government seeks to avoid health insurance rises
With mid-term US elections due just after insurers typically announce new premiums it would not sit happily with voters if their health insurance plans, the ones the government has encouraged them to take out under the ACA, suddenly cost a lot more. Writing a
guest post for Forbes, the President of
Americans for Prosperity, Tim Phillips says that a political disaster may be averted by the wording of a regulatory update from the Department of Health and Human Services that suggests there will be ‘bailout’ funds if lower premiums cost insurers money. As well as the initial impact of higher premiums, the government is concerned that people will cancel policies in volumes which have the potential to bring down the Obamacare system in some states.
Australian insurers welcome inquiry into financial system
The Insurance Council of Australia (ICA) today welcomed the release of the Financial System Inquiry interim report and the opportunity to provide further evidence to support improvements to Australia’s financial system.ICA CEO Rob Whelan said: “The Financial System Inquiry interim report has taken into account the ICA’s submission on behalf of general insurers, and little fine-tuning is required. We conclude that with the appropriate regulatory and policy settings, a greater allocation of risk can be intermediated through general insurance, including that risk currently borne by governments."
