The Bank of England has written to dozens of insurance companies to assess the risk that climate change poses to their solvency and earnings, in a sign of regulators’ growing concern about the potential financial fallout of global warming.
In an unusual move for a central bank, it has asked about 30 insurers if they know when changing temperatures or more frequent extreme weather disasters might start affecting “the viability of [their] business model”, the Financial Times has learnt.
The letter from the Bank’s Prudential Regulation Authority, seen by the FT, also asks if companies have considered the impact that climate change could have on their investment portfolios.