In a statement, Illinois-based Allstate Corp’s CEO Tom Wilson said, in the event the Joe Bidden wins the elections, he wants the Biden Administration to back a taxpayer-funded program that would pay for the losses it incurred because of climate change.
The development comes at a time when Democratic presidential challenger Joe Biden was leading Republican incumbent President Donald Trump in electoral college votes on Wednesday evening, even as the ballot count looks poised to stretch into a third day.
Biden has outlined an ambitious plan to invest $2 trillion in clean energy to get the United States to reach net zero carbon emissions by 2050.
A potential Bidden climate package should include legislation that addresses destruction of property caused by hurricanes and wildfires.
Allstate is one of the largest U.S. property and casualty insurers.
“You need really disaster protection because if the weather keeps getting worse, the private market for those really big events is going to be too expensive,” said Wilson.
Insurers are bracing for nearly $4.3 billion in insured losses from Hurricane Zeta in the United States, said catastrophe modeling company Karen Clark & Co while adding that this year has seen a record number of named storms making landfall in the United States.
This is on top of a Moody’s estimates which could touch $8 billion in losses arising from wildfires on the West Coast, which scientists say were partly fueled by climate change.
According to the California Department of Insurance, the growing risks of wildfires have led insurers to drop thousands of homeowners in the most vulnerable areas.
Allstate would “love” to see Biden confront climate change, a problem policymakers have tried to address through long-term measures, said Wilson while adding, “But people spend a lot of time arguing about the long term solution when a house is burning down.”
“A government-backed program could be modeled on state-run insurers of last resort, such as the California Earthquake Authority, which cover natural disaster risks that are too steep for private property insurers to take on,”said Wilson.
Incidentally, the United States already runs a taxpayer-funded flood insurance program and has created government-supported commercial terrorism products following the September 11 attacks, which require insurers to pay part of the claims.
Some property and casualty insurers are pushing for a federal program to cover small business losses resulting from future pandemics. “I think there are both Democrats and Republicans that are in the areas that are impacted by this, that would be in favor of a solution,” said Wilson.