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Climate threat : the index of the actuarial undergoing a change in history

by

Aurélia Morvan

30 August 2019 11:30

Photo : Freepik

The last winter confirms a little more the climate disruption in North America. The five-year average of theIndex of the actuarial climate (IAC), a tool for monitoring trends in climate, reached its highest level during the winter of 2018-2019, for Canada and the United States. The previous record had been beaten… in the previous season.

Period is the “most aberrant”

The IAC in the winter of 2018-2019 has been set to 1.00 by the organizations representing the actuarial profession in Canada and the United States, a fact that contributes to the upward trend of the value of the IAC for the winter season.

Taking into account this new data is seasonal, the five-year moving average of the IAC is now 1.10. This moving average was 1.02 the last time it was calculated, that is to say, when the IAC in the fall of 2018 has been taken into account. Thus, the moving average has increased by 0.08, which represents the largest variation from one quarter to another during the study period, which stretches from January 1961 to February 2019.

“Since the last quarter, the moving average of the IAC has experienced its largest increase during the period of 59 years covered by the index, which makes this five-year period the most aberrant to date in terms of extreme weather conditions and an increase in the level of the sea,” said Doug Collins, chairman of the working group on the Index of the actuarial climate.

Six observed variables

The IAC combines the seasonal data quarterly of six variables “that have the most effect on the people and the economy” : the high and low temperatures, rainfall, the duration of droughts, strong winds, and the level of the sea.

Designed to ” present to the actuaries, policymakers and the public at large with objective data regarding the variations of the frequency of extreme weather events in recent decades “, it was launched in 2016 by four organizations representing the actuarial profession in Canada and the United States : thecanadian Institute of actuarys, theAmerican Academy of Actuaries, the Casualty Actuarial Society and the Society of Actuaries.

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