Climate change hits South African insurance

Herald Online (South Africa): The effects of global climate change will soon touch the wallets of many South Africans as insurance premiums for those living in high risk areas is set to rise. This comes as international re-insurers say the South African insurance industry is poorly prepared for the effects of climate change, taken seriously in Europe and north America.

High insurance risk areas include the Southern Cape, repeatedly affected by floods in the last five years, as well as those living near rivers, wetlands and the seashore. It also highlights what specialists have said for years: that climate change is an environmental and economic problem.

Santam, the country‘s largest short-term insurer, has announced that it will adopt “higher pricing structures” to insure against the effects of climate change because it has to cover risks that are more volatile and less certain. Santam has not said by how much premiums will rise, because each policy-holder will be assessed according to his or her specific risk of being affected….