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You take a special case -- tropical cyclone losses in the USA from 1971 to 2005 -- and project that on the entire world, claiming to know better than Munich Re... Are you an American politician, by any chance?

The basis for the 11% number quoted in the ABC article :

"If we look at the sheer number of losses from natural catastrophes worldwide since the 1980s, more than $US1,600 billion in losses have occured. Most of them were actually weather-related, not earthquakes, not geophysical events."

And he says the economic cost of these disasters, once you take out things like inflation and currency fluctuations, is increasing by 11 per cent a year.

Whereas in the ScienceDirect abstract :

losses excluding socio-economic effects show an annual increase of 4% per annum.

It's hard to see a specific contradiction here :

  • Do you assert that "socio-economic effects" of hurricanes in Louisiana or Florida have been negligeable?
  • Perhaps climatic disasters have been more severe in the world in general than in the US Atlantic coast? (Well golly, you wouldn't think so when you look at the news media.)

And you mentioned "scientific publications"... so you've got more that you'd like to discuss?

And what's the thesis here? Munich Re are exaggerating climate risks in order to justify higher premiums? Or they are honestly but stupidly exaggerating the risk?

Reinsurance is a competitive business. I doubt that they could get away with scamming their clients.

It is rightly acknowledged that people of faith have no monopoly of virtue - Queen Elizabeth II

by eurogreen on Tue Nov 2nd, 2010 at 07:39:03 AM EST
[ Parent ]
One problem with the reinsurance industry is that it works from flag-of-convenience countries like Bermuda. So no it is not competitive, and yes it can get away with scamming its clients.

So it is perfectly possible that they are gouging their customers on the increased risk of adverse weather events. However, the solution to gouging is to regulate the industry, not to idly bemoan the fact that they are gouging.

- Jake

Friends come and go. Enemies accumulate.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Tue Nov 2nd, 2010 at 07:54:35 AM EST
[ Parent ]

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