A bulletin from Lloyd’s of London warns that, “as sea levels rise, ground levels in coastal megacities are also falling – with potentially disastrous implications for insurers. Insurers of large property portfolios in the world’s great coastal cities will have factored the effects of climate change into their catastrophe models – including rising sea levels and more frequent storm surges. But what’s often missed is that many of these cities are sinking faster than the water is rising. In some, subsidence outstrips sea level rise by a factor of ten to one.”Via The Lens's tweeter tube
The subsidence heightens the potential losses from rising sea levels. Combined with “sea water inundation and flood damage, this can have disastrous consequences for the built environment – and property and business interruption insurers.” Gilles Erkens, of the Deltares Research Institute in Utrecht said: “We’re going down and the sea is coming up. Potential losses could run into hundreds of millions of dollars every year.”
As an example Lloyd’s singled out the “surge that overwhelmed New Orleans following Hurricane Katrina, and the subsequent cascading collapse of critical infrastructure,” which it said “offered a glimpse of the sort of scenario underwriters fear.”
Wednesday, August 13, 2014
The market has decided you are screwed
Lloyds of London asses the risk to coastal cities due to global warming.