Well, it's gotten a bit nippy down here in Camp Swampy - aka New Orleans. Seems the entire Gulf South has gotten a taste of some serious cold weather lately. With the arrival of this cold weather, of all the things to mull over, the one that never ceases to amaze me most is the fact that people persist in leaving water pipes and other freezing-prone items exposed down here despite knowing that EVERY year the temperatures are going to fall below freezing. So, instead, we run the faucets all over the house all day and night and hope a pipe doesn't blast open from the irresistable forces exerted by freezing water. There's something to all that. There's something to the fact that people, knowing something is inevitably going to happen - a matter of when, not if - continue to refuse to do a damned thing about it and only RE-act versus acting (pardon the term) pre-emptively. There's something to this whole notion of what makes so-called 'economic' sense to people. Cost/benefit, risk analysis. I guess it all falls under headings such as those. It's just not worth the time and effort to make those changes or incur the added costs of insulating pipes that are only at risk perhaps a few days of every year.
Insurance companies, despite being the vile, pillaging scum they are in most instances, tend to be pretty good about monetizing the impacts of our decisions (insulate the exterior pipes and you'll avoid busted pipes and the cost of repairs to not only the pipes but anything else the now liberated water may have (severely) damaged OR pay an additional amount to said insurance company in the form of premiums to cover the distributed risk of assuming responsibility for repairing those uninsulated pipes and all the other crap that got soaked when the water sprayed it sopping wet during the wee hours of that cold, cold winter night while you slept soundly dreaming of large, well rounded women (not that I ever have that dream, mind you!).
As it turns out, there's a good deal to be learned about the rationale and logic of human cost-benefit analysis from the way in which insurance companies calculate risk. A calculation that they then, in turn, pass along to people in the form of higher and (if only rarely) lower premiums. As a result, we could then extrapolate out this line of thinking to consider how such risk is being monetized by insurance companies to determine whether they have factored the subject - and implications - of climate change into their calculus and passed those anticipated risks on to customers. If so, the potentially potent positive feedback loop created by this sequence of cost impacts may lead to a net effect of decreasing the incidence of behaviours that promote climate change.
Or would it?
In fact, no. Let's go back to my uninsulated pipe for a moment. Effectively, that pipe represents, let's say, the ocean (stay with me here). The house is Earth, Mr. Homeowner is the world's population, yada yada yada... On a planetary scale, insurance companies aren't rewarding or discouraging behavior that may cause/prevent the pipe from popping open. Instead, they're looking at only the risk involved in setting your kid's science fair award winning paper-mache' rendition of Mount Aetna (I couldn't resist mis-spelling it and pulling in the insurance company tie-in, hehehe) beneath that burst-prone pipe. Why? Because stowing it there will undoubtedly, at some point or another, lead to it becoming a bleary, soggy mess of cellulose on damp plywood that was once Sicily!
Insurance companies are only a canary in the coal mine, not the tollman at the bridge. They are reflecting the recognition of increased risk of activities associated with the EFFECTS of climate change, but are not tempering or inhibiting the CAUSES of it: Principally, the belching out in vast quantities carbon emitted as a byproduct of the combustion of oil and coal. Those people stepping on to those planes to go from Pasadena to Providence are not incurring an added cost to their trip that is a function of the risks fostering accelerated climate change and the mind-boggling effects that will have on planetary life as we've grown accustomed to it. But, in fact, that is precisely where (among others) the costs should be levied. It would discourage the use of air travel, which is one of the most profound culprits in this equation of carbon emissions, and foster more climate friendly travel (or discourage travel, altogether).
The same goes for the coal fired electricity generating station or the oil rig located off the coast of Nigeria or that cute, copper-colored Acura SUV or the 3,700 square foot retirement home built on the exurb frontier of Atlanta or... You get the idea. If innsurance companies were responsible for cleaning up the mess created by these activities, cumulatively - and it is going to be a big mess, mind you - then they'd be weighing the contributing effect of these respective activities and charging higher premiums accordingly. But they're not. They're not because that's not their job. They are only watching the water rise and ensuring you've rolled your pant legs sufficiently high enough up to avoid having to pay your dry-cleaning bills should they get wet by those rising waters. Preventing the burst water pipe, rising waters, decimation of entire ecosystems, extinction of whole orders of plant and animal life, starvation of potentially billions of people, etc., is the provenance of another mechanism; another body.
How does that risk get calculated? How does it get monetized? How does it get passed on?
And, perhaps, just as importantly: Is this a role for Government?
I'll leave that for another time.
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