Japanese insurers grapple with estimating climate change cost
Regulators are still learning their way in setting rules on disclosure.
Japanese insurers are struggling to pinpoint climate change cost estimates, reports Reuters, as second-largest insurer MS&AD expects the potential rise in claim payments in 2050 to be anywhere between five to 50% from current levels.
Sompo Holdings plans to announce a similar estimate in August but with plenty of caveats, its officials say. Whilst others, including Tokio Marine & Nichido Fire, are wary of even producing estimates, citing a lack of data.
The wide range produced by MS&AD illustrates the difficulty of pricing climate costs, and underscores the challenge financial institutions face in meeting pressure by investors for more disclosure.
Japanese regulators are still learning their way in setting rules on disclosure, lagging their counterparts in countries like Britain and France who have already announced plans to conduct stress tests incorporating climate risks.
Here’s more from Reuters.