In a letter to the Treasury’s Federal Insurance Office, the National Association of Insurance Commissioners expressed its “deep concern” over a proposal to collect data on climate-related risks from property and casualty insurers, as well as disappointment that insurance commissioners have not been engaged in the effort thus far.
“The unilateral process Treasury employed thus far is a missed opportunity to work collaboratively with regulators on an issue we have both identified as a priority,” said the letter from NAIC leaders. “FIO has failed to demonstrate a good faith effort to engage with state regulators and has exhibited their intention to forgo a collaborative effort to identify and collect accurate and useful data.”
The NAIC said their Climate and Resiliency Task Force was established more than a decade ago and has been addressing climate-related risk and resiliency issues.
The FIO in October said in a Federal Register notice that it was seeking public comment on its proposal to collect current and historical underwriting data on homeowners insurance, on a granular, ZIP-code level.
“It is unclear how FIO will use the data they intend to collect, and it is likely that any analysis will be misinterpreted and produce fallacious results in trying to identify climate risk,” NAIC said. “Treasury is requesting property insurance market data at a granular level, but it is unclear how that data will be married with other information to illustrate climate risk specifically.”
Industry trade associations the American Property Casualty Insurance Association (APCIA), National Association of Mutual Insurance Companies (NAMIC), and Insurance Information Institute (Triple-I) have already blasted the FIO’s proposal.
The NAIC said the time used by the FIO to request feedback from the industry on a hypothetical proposal “could have been better spent working collaboratively with regulators to produce a data call best suited to the task.”
“FIO should leverage publicly available data and work with state regulators to better inform a data collection effort to fit its ill-defined purpose,” NAIC added.