Not just Florida.
A lot of wake-up-in-the middle-of night-Oh-Shit moments going on about near term financial consequences of climate extremes.
I happened to have had a mind-expanding chat with old friend and thermal science jedi John Abraham this morning, I’ve excerpted that below. John provided the graph of NOAA data above.
US Dept of Treasury has a new study focusing on this.
- Households can experience significant financial strain through pressures to their income and expenses. Climate hazards can cause widespread physical damage and force interruptions and closures of normal operations of businesses, governments, and other critical services. As a result, households can face financial strain from lost income and higher costs or reduced access across a range of consumer goods and services.
- Reduced earning and access to employee benefits. Climate hazards like wildfires can lead to unsafe working conditions necessitating business closures. Households in impacted areas could face reduced income due to job loss or reduced working hours. Further, prolonged time away from work could cause workers to lose access to employer-provided benefits such as health insurance.
- Damage and destruction to property. Climate events like floods can cause significant damage to household property. While damage remediation is urgent, households may lack the financial resources needed for repairs or replacement.
- Increased spending on transportation. Households’ spending on transportation varies depending on the mode and frequency of transportation, access to public transportation, and proximity to frequently visited places. Climate events can add to households’ expenditures on transportation, including by increasing gasoline prices by causing shortages or increased demand.
- Added healthcare costs. Climate events and conditions can result in physical injuries, including those requiring medical care. For impacted households, climate-related hospitalization or medical services can lead to an overall increase in healthcare expenditures.
- Higher expenditures on utilities. As climate events and conditions continue to grow in frequency and intensity, households may face additional expenditures on utilities. For example, households exposed to heat waves and higher average temperatures are more likely to use air-conditioning, which could increase their energy consumption and associated expenses.
Treasury’s Federal Insurance Office announced Wednesday that it will collect data from the nation’s largest property insurers to pinpoint areas vulnerable to “major disruptions” in insurance coverage.
The federal effort, which has never before been undertaken, will assess “the increasing impacts of climate change on household budgets” and help officials develop ways to make property insurance more available, Treasury Secretary Janet Yellen said in a statement.
Three hours after Treasury’s announcement, Sens. Sheldon Whitehouse of Rhode Island and Ron Wyden of Oregon, both Democrats, said they are investigating how climate change threatens the solvency of major insurers in four disaster-ravaged states. They sent letters to 40 insurers in California, Florida, Louisiana and Texas seeking information and documents that would show how the companies are dealing with climate change and where they have pulled back coverage.
Whitehouse, chair of the Budget Committee, and Wyden said they feared that climate change and insurance scarcity will create “a widescale decline in property values.”
A third inquiry, planned by an organization of state insurance regulators, will collect data from property insurance companies to show “localized protection gaps” in the U.S. where coverage is expensive or scarce.
The National Association of Insurance Commissioners is still finalizing the details of that inquiry. But the group expects to ask major insurers for information in each ZIP code they serve about premiums, losses, nonrenewals of policies and other items, association spokesperson Kim Stewart told E&E News.
Although state insurance regulators have extensive information showing how insurers are affected by inflation, reinsurance costs and climate-fueled disasters, they lack data showing the effects on availability and affordability in individual areas, the association has said.
The near-simultaneous probes are likely to increase pressure on insurance companies and regulators to focus on climate change and its threat to insurers from increased property damage during natural disasters. In recent years, wildfires have destabilized insurance markets in California and Colorado, and hurricanes have upended markets in Florida, Louisiana and Texas.
Across the U.S., many areas projected to have high future exposure to climate hazards also overlap significantly with areas in which the underlying populations may be particularly vulnerable to financial hardship. An analysis in the report finds that half of U.S. counties – populated by millions of Americans – face heightened future exposure to at least one of the three significant climate hazards described in the report: flooding, wildfire, or extreme heat. In addition, approximately one-fifth of all U.S. counties face both elevated vulnerability and elevated future exposure to these climate hazards.
The report profiles three regions in the country to illustrate the potential impact of major climate hazards:
- Flood exposure in Appalachia: Flooding imposes severe financial hardships on Appalachian households by damaging critical infrastructure like roads and bridges, which could potentially reduce access to key community resources like healthcare centers.
- Wildfire exposure in border regions between the U.S. and Mexico: Households in U.S.-Mexico border areas with outdoor workers face financial strain due to future wildfire exposure, which could result in lost income from foregone working hours.
- Heat exposure in the Mississippi Delta: Households in the Mississippi Delta face financial challenges due to future extreme heat conditions, as resulting heat-related illnesses can necessitate added spending on healthcare.
Full US Treasury report can be found here.