Transcript Disaster Mgmt Conference 2009

Adaptation to
Climate Change
Robert Tremblay
Director, Research
Insurance Bureau of Canada
APEGGA
Edmonton
April 15, 2010
Who is IBC?
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Trade association representing Canada’s
private home, car and business insurance
companies
Over 200 Companies
$25 billion in claims paid
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The business of insurance
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Risk management tool to protect assets for
sudden and unforeseen events
Cover residential, car and businesses
Spread the financial risk
Players:
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Primary insurers (domestic)
Re-insurers (international)
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Role of insurance
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Provides vital underpinning to society and
to economic growth.
Enables individuals & businesses to take
decisions without fear of extreme financial
losses from relatively low probability
events
Induces individual and businesses to take
more intelligent risks without burdening
governments and society
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What Canadian insurers covers…
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Homes
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Businesses
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Fire, theft, vandalism, wind damage,
Sewer back-ups
Business interruption
Production means and premises
Floods
Liability Insurance
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Municipal
Professional, commercial
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Climate Change: Industry’s Challenge
Why?
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More severe weather more frequently
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Mid-to-long term issues of availability and
affordability of insurance
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Background: Largest insurance disasters
Source: ICLR
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Background
Examples of Canadian weather-related
events
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Saguenay floods (1996)
Ice Storm (1998)
B.C. Wild Fires (2003)
Peterborough floods(2004)
Toronto rains (2005)
Hamilton-Ottawa rains (2009)
$1.5 billion
$1.6 billion
$200 million
$ 90 million
$500 million
$200 million
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Alberta winds (2009)
$300 million
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Vaughn tornadoes (2009)
$ 80 million
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Background
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Infrastructure/structure failure often the
trigger
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Saguenay Floods (dams)
Ice Storm (electric grid)
Peterborough (sewer/surface water systems)
Toronto (sewer/surface water systems)
Ottawa/Hamilton (sewer/surface water)
Alberta wind (wind loads)
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Background
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August ’05 Toronto rains
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$500 million in sewer back-up claims
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More basements are finished
Value of contents much higher than before
High density of dwellings
July ’09 Hamilton-Ottawa rains
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6,000 homes Hamilton
1,400 homes Ottawa
More than $200 million
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Background
In all cases…
 Insurance played its role
 Claims were paid promptly
 Economic hardships were avoided
 Lives went back to normal
 Economy could continue to grow
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Adaptation: Key Element
Insurance Industry Consensus:
 Climate change is most important public policy
issue facing Canada today
 Dialogue must shift to include adaptation
efforts
 P&C insurance industry has an opportunity to
contribute significantly the adaptation
discussion
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Adaptation and governments
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Municipal governments
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Provincial governments
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Starts at local level
Must provide guidance, resources
Federal government
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Leadership, resources, tools
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Adaptation: Help municipalities
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Develop Municipal Risk Assessment
Tool
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Quantify the risk of infrastructure failure
Both current and future climatic patterns how
much rain, where, and when.
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Risk Assessment Tool
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Builds on Work done by PIEVC
Top down VS bottom-up
Watershed-system design-operation
Actual capacity
Designed as a quick diagnosis not a
prescriptive solution
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Watershed Awards
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Need to reward raise awareness of things
that are well done!
New National Award to recognize
municipalities, IBC/FCM partnership
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5 regional awards, 1 national
Recognition in regional daily a national daily
for national winner
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Insurance Research Lab for Better Homes
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UWO
Real size home to study impact of wind
loads on structures and components
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Need for dialogue
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Too late to bury head in sand
Preaching to the choir…
Assessment tool brings the need to
discuss:
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Performance standards
“Acceptable risk”
Need to broaden stakeholders
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Public Education
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Community outreach programs
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Educate home owner how they can act
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Backflow valves
Landscaping
Rain barrels
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Tools/Research/Knowledge Transfer
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Updated IDF curves
Downscaled Climatic maps
Building code revisions
Need for interim engineering guidance
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Why do we care about the weather?
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Water claims – creating cost pressures
($1.3 billion annually)
Reduced claims costs = available &
affordable insurance
It is our business
Help Canadians stay safe – they want us
to
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Conclusion
In conclusion…
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Moral duty to ensure Canadians protected
Mitigate damage through adaptation
measures
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Homes protected, communities more resilient.
Nothing new
Insurance industry can be catalyst for
adaptation
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