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I’m at a legal conference in Paris – how did they choose this beautiful city?
One of the discussions I have repeatedly had with my new French friends has to do with their climate change. The Burgundy wine region seems very similar to the drought-stricken western United States.
In an article from last year, French vineyards suffering from severe drought in some regionsnoted:
The drought threatens this year̵
7;s vintage in the Gironde around Bordeaux, one of France’s most famous wine regions.Weather experts say the country has just had its driest July since 1959.
Although vines thrive in a dry climate, there is only so much they can take.
France’s rural law bans irrigation from May 1 until harvest, but some growers have been given special permission to water their plants this year.
“The two people who are there each have a hose with a metal tip on the end that allows the water to go straight to the root of the vine,” explained Paulin Calvet, the owner of du château Picque Caillou. “So that this water doesn’t spread anywhere but stays in the heart of the vine, to make the water really go down the stem to reach the roots directly.”
This year, the south of France had five days of rainfall that would normally have been in the same five weeks, resulting in severe flooding.
The French talk just like us about how much warmer the climate has been and how much more difficult the weather is. It hailed in Paris yesterday and blew over a large tree a block from my hotel.
Climate change is an international phenomenon and has an impact on property insurance prices on a global basis.
In a 2021 paper, the International Association of Insurance Supervisors concluded that climate change needs to be addressed by insurance companies when considering their solvency risk:
- Regulators should assess the relevance of climate-related risks to their regulatory objectives. They should collect quantitative and qualitative information on the insurance sector’s exposure to and management of physical, transitional and liability risks associated with climate change.
- Climate-related risks should be considered for inclusion in insurers’ own risk and solvency assessments. It is expected that insurers will take appropriate risk management measures to mitigate any identified risks.
- Insurers should assess the impact of physical and transition risks on their investment portfolio, as well as on their management of assets and liabilities. A forward-looking view, including the use of scenarios, can help insurers gain a better understanding of the risks.
- Material risks associated with climate change should be disclosed by insurers, in line with Insurance Core Principle ICP 20 (Public Disclosure). Regulators can use the TCFD framework when developing best practice or as input to set their own regulatory objectives
The bottom line is that we in the US are not alone in the impact of climate change on insurance risks and prices. This is also an international issue.
I would suggest that one of the benefits we learn from traveling is our outlook on life changes as our perspective changes.
Paris is a beautiful city, and the French countryside is wonderful. If you get a chance to travel and spend time in the French countryside, you will find it very different from Mark Twain’s comments about the French.
Today’s thought
The objects in which the people of Paris are fond – literature, art, medicine and adultery.
– Mark Twain
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