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Unpacking US State Regulators' Plan to Climate Proof Insurance
What's in the National Association of Insurance Commissioners' climate resilience strategy?
Louie Woodall
March 21, 2024
AI-generated via DALL-E
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TL;DR
The National Association of Insurance Commissioners has set climate risk and resilience as a 2024 priority
This week, the association adopted a strategy to help climate-proof the industry, focused on data collection, risk mitigation, and scenario analysis
Implementation will be key. How widely the NAIC shares the data it collects, and what the focus of its scenario work will be, are key questions
The NAIC and others are also adamant that the resilience of the insurance industry can’t be improved by state regulators alone. Governments at all levels have to contribute, too
On Monday, insurance regulators gathered for the spring meeting of the National Association of Insurance Commissioners (NAIC) adopted a first-of-its-kind National Climate Resilience Strategy.
It’s a significant milestone. The NAIC acts as a standard-setter and information hub for the US’ flock of state insurance commissioners, making it an important cog in the country’s regulatory machine. How the association and state regulators respond to climate risks today could have profound implications for insurance markets and the climate resiliency of the US economy as a whole.
The strategy is wide ranging. Among other things, the NAIC wants to create new resilience tools, lobby public authorities for “pre-disaster mitigation funding”, and roll out climate scenario analysis resources to state regulators. It’s also keen to get started — one of its 2024 priorities is addressing climate risks, natural catastrophes, and resilience.
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