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The reinsurance industry assures insurance companies to help reduce the risk associated with the policies subscribed. Insurance rates have increased in areas with extreme weather events.
Frank Nutter, president of the American Reinsurance Association, says that climate change is an important factor for insurance and reinsurance companies.
"The consequences of climate change are quite real for our industry and will have a significant impact on the economy in the future," he says.
From the perspective of subscribers, encouraging people to build in coastal areas, barrier islands and other high-risk areas inevitably increases the level of risk and exposure not only by the value of the properties-including high-value homes. – but for the cost of repair and recovery of property and public infrastructure.
"The cost of climate change must be taken into account in public and private insurance," says Nutter. It is also a cause for concern: forest fires exacerbated by climate change that expose more households and businesses to losses covered by federal disaster assistance insurance.
Nutter calls for long-term investment to mitigate losses, better land-use planning, better building codes, greater use of green infrastructure to protect property and a change in government philosophy.
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