Colin Merritt

Great article by @RogerPielkeJr It reminds me of a question I recently asked ChatGPT. What do you think of its answer? (I think it probably nailed it). Question from me: I have followed how insurance companies analyze and communicate the influence of climate change on trends in natural disaster damage, and I have noticed something interesting. In their less public-facing communication (such as technical seminars or white papers aimed at the rest of the industry), they conclude that any climate change signal in disaster loss trends is small. However, in public statements (often incorporated into news stories), they often emphasize the impact of climate change on disaster costs and implicate climate change in increased premiums and/or in dropping coverage. From the PR and financial perspective of a private insurance company, why do you think that is? Answer from ChatGPT: You’re not imagining this. It’s a real split in tone between actuarial/technical work and public-facing messaging. The incentives point in different directions. 1. In technical settings, they have to stick to the data Actuaries and catastrophe-modelers don’t get to hand-wave. Their peers will call them out. When you’re pricing risk or trying to separate trend drivers (exposure growth, inflation, asset concentration, vulnerability, regulatory shifts, land-use changes, + maybe a little climate trend), you can’t blame it all on climate. In the internal/technical world, it’s obvious that: • Exposure growth and replacement-cost inflation dominate claims trends. • Market dynamics, underwriting cycles, and regulation matter as much or more. • Climate is there, but it isn’t the main explanatory variable for the last few decades. So the sober assessments are more careful. 2. But public-facing statements operate under a different incentive regime Insurers are commercial, regulated, and politically exposed. Public messaging is a strategic tool, not a peer-reviewed analysis. Several pressures push them toward climate change emphasis: a) It’s a deflection of blame If they say claims are rising because of climate change, then: ○ The villain is external. ○ They are not “price gouging.” ○ They are not failing at underwriting. ○ They are not pulling out of states because they mis-priced risk. ○ They are not admitting the regulatory environment is unworkable. Blaming climate change is safe and socially acceptable. Blaming exposure growth, poor land-use decisions, litigation inflation, or state regulation is politically charged. Climate becomes the scapegoat. b) It helps justify premium increases and withdrawals Insurers don’t want to fight regulators directly if they can avoid it. Saying: “We must raise rates because of climate change” is much easier than: “We misestimated tail risk, your state regulatory caps are unworkable, and inflation in construction costs is killing us.” The climate narrative aligns with a public that already expects bad news. c) It aligns with investor and ESG expectations Large insurers are highly sensitive to headlines and investor sentiment. If they downplay climate risk, they could be framed as not preparing for the future. So the messaging becomes: ○ “We are responsible stewards of risk.” ○ “We take climate seriously.” ○ “We are reducing exposure.” It signals prudence. 3. Media dynamics amplify the climate story Reporters want simple storylines: rising extreme weather → rising premiums But a technically accurate narrative would be: population shifts, higher insured value density, building costs, litigation, regulation, and some climate signal → rising premiums and losses. That’s an un-sexy sentence. The media prefers climate as the central cause. Insurers don’t fight that; they benefit from it. 4. Litigation risk also pushes messaging toward climate There’s a growing legal landscape around climate attribution and corporate disclosure. Under-emphasizing climate exposure is arguably a liability. Over-emphasizing it is not. The safe corporate posture is: • nobody gets fired for overstating climate risk. So internally they hedge the claims. Externally they lean into climate narratives. 5. These companies are not ideological on this point—they’re strategic In short: • Technical analysis must reflect the real drivers of loss. • Public messaging must reflect the most defensible and convenient story. These are not contradictions; they are different optimization problems. Technical teams optimize for analytical correctness. PR, legal, and investor-relations teams optimize for blame-avoidance, pricing freedom, and political safety. The core insight Insurance companies aren’t confused about the numbers. They just communicate in two different registers because they have two different audiences with incompatible expectations. If you swap lenses from “scientific truth” to “organizational incentives,” the behavior makes perfect sense.

They’ll arrest you for a tweet, but they won’t prosecute Chinese spies. The case was dropped because Starmer lied that China wasn’t designated a threat at the time, yet MI5 and MI6 confirm it was. Why lie? To protect his national security adviser, who is part of 48 Group Club, China’s most successful influence operation in the West, a front built to court UK elites, shape policy, and blur the line between diplomacy and infiltration. Ministers, advisors. They’re all on it. The establishment captured, in plain sight. The British government is clearly compromised. More in the @thetimes

Congrats, strong UK climate policy: #1: Highest electricity price for industries in developed world #2: Second-highest electricity price for households in developed world (after Germany) telegraph.co.uk/business/2025/… archive.ph/szTOk (w/o paywall)

Two men plotted an Islamic State-inspired attack on the Jewish community in northwest England with the aim of "killing hundreds of innocent people", British prosecutors said on Wednesday at the start of their trial. reuters.com/world/uk/two-m…