Groups Call on U.S. Treasury to Measure Climate Crisis’ Impact on Insurance
Climate Impacts on Affordable Insurance for Underserved, Minority, and Low-Income Communities Requires Granular Data
WASHINGTON, D.C. — More than 75 advocacy and environmental groups today called on the U.S. Treasury Department to begin collecting consistent, comparable, and granular data to evaluate how climate change is harming insurance consumers.
“The insurance industry has spent decades fueling the climate crisis through investments and underwriting,” said Carly Fabian, policy advocate with Public Citizen’s Climate Program. “As the climate crisis intensifies, the industry is forcing the most vulnerable consumers to foot the bill by raising premiums, reducing coverage, and abandoning entire communities. The industry’s uniquely opaque regulatory system leaves consumers in the dark on discriminatory practices and the industry’s response to climate change. Congress created the Federal Insurance Office (FIO) with the authority to collect this data directly from insurers, and it’s past time for FIO to collect and publish this data to highlight a national insurance affordability crisis.”
In the letter, the groups, including Public Citizen, Americans for Financial Reform Education Fund, Sierra Club, Greenpeace USA, Hip Hop Caucus, and National Housing Resource Center, pushed the Treasury’s Federal Insurance Office (FIO) to put specific focus on how low-income and traditionally underserved communities have been impacted by rate hikes by insurance providers.
The groups call on FIO to strengthen the proposal by collecting data on the most vulnerable communities, including data on policies covering renters, consumers dependent on insurers of last resort, and climate-related perils like wildfires and wind, which are increasingly excluded from standard coverage. Further, the groups ask FIO to publish as much data as possible once it has been collected.
In addition to the group letter, more than 9,000 individuals signed a petition calling on the FIO to begin collecting ZIP Code level data from property and casualty insurers detailing current and historical underwriting of homeowners’ insurance.
“Access to insurance is essential for me and my community’s financial and emotional security,” the petition reads. “If insurance becomes unaffordable or unavailable in my community, this crisis could threaten our homes, life savings, and local economies. My community needs urgent solutions to address this growing crisis.”
The letter and petition come in response to FIO’s October 2022 proposal to collect data from insurers, allowing the office to assess climate-related financial risk across the United States. The data collection will inform the FIO’s assessments for potential major disruptions of private insurance, especially in areas particularly vulnerable to the impacts of climate change, as outlined in President Joe Biden’s Executive Order on Climate-Related Financial Risk, issued in May 2021.
With the comment period closed, the FIO will review comments, consider changes to the data collected, and issue a finalized data collection template to insurers.