Carney Repeats Climate Insurance Losses Myth
By Paul Homewood
Mark Carney’s latest attack on fossil fuels took place in a speech at Lloyd’s of London. Unsurprisingly then, part of his spiel referred to the supposed rising cost of settling weather related claims:
Since the 1980s the number of registered weather-related loss events has tripled; and
Inflation-adjusted insurance losses from these events have increased from an annual average of around $10bn in the 1980s to around $50bn over the past decade.
We have no need to go over this old ground, as Roger Pielke Jr has already well and truly destroyed the myth that rising costs reflect anything other than economic factors.
But it might be useful just looking at what the BBC had to say about Lloyd’s profits for last year:
http://www.bbc.co.uk/news/business-32063243
Insurance market Lloyd’s of London has reported reports profits of £3.2bn for 2014, unchanged on the previous year.
Lloyd’s chief executive Inga Beale described the results as "strong", given the "challenging market conditions" that it faced.
Profits were helped by a "relatively benign" year for major natural catastrophes, Lloyd’s said, as well as better returns on investment.
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NOT A LOT OF PEOPLE KNOW THAT 
The problem is he won’t have a clue what the situation is and will rely on his relevant advisor. That advisor is likely to be a fully paid up member of the CAGW club
Ronald Reagan summed up the problem this way: “It isn’t so much that liberals are ignorant. It’s just that they know so many things that aren’t so.”
His strongest “advisor” is his English wife who is an environmental zealot.
I have explained on various sites how this myth has arisen.
There are two components:
1 the chronic underestimation of the effect of affluence and demographic factors on insured losses by leading industry players such as Munich Re and Swiss Re. Their inflation factors tend to be based on price indices, so neglect or undervalue the increase in “stuff” that people have, and the population shift to Florida in particular where many thousands have built fancy beachfront homes.
2 The start point he chose was the 1980’s which was a relatively quiet period for weather catastrophes. Insured or insurable losses for the 1920’s, 1930’s, 1940’s 1950’s and 1960’s were all far higher than the 1980’s in real terms.
Don’t read too much into the excellent Lloyd’s profit figures. The last few years have been exceptionally quiet for US weather related events, and pretty much all of the recent aggregate profit can be accounted for by premiums taken in for catastrophe perils where there were very few claims – to be fair, Ms Beale stressed that point. The underlying performance is close to break even.
BTW I was present at the dinner. It was pretty dispiriting that someone with such power could talk such nonsense.
Why should we take any notice of someone who knows nothing about climate and who “thinks” he controls the economy, interest rates and inflation.
The next economic crisis will be as unexpected as the last one and will come as a complete surprise to economists, including Mr. Carney.
By then, of course, Mr. Carney will probably be long gone.
“Since the 1980s the number of registered weather-related loss events has tripled”
FFS, if it were true that this was as a result of cAGW, then it must surely be too late, we’re all doomed, and thus there’s nothing left to do but die? In other words, we might as well relax and enjoy life.