15
Jul
It Is Really Hot. Will Insurance Companies and Congress Meet the Moment?
(Beyond Pesticides, July 15, 2024) It is hot. Really hot. A serious response to this climate emergency requires, according to environmental advocates, a dramatic transformation in land management and an end to the use of petrochemical pesticides and fertilizers. Beyond the real-world adverse effects of the climate crisis— more intense and frequent fires, floods, hurricanes and hail storms, as well as the harm to health and biodiversity—the rising insurance premiums imposed by the insurance industry speaks to the need for an urgent systemic response. According to the paper, Pricing of Climate Risk Insurance: Regulation and Cross-Subsidies, “The unprecedented rise in natural disasters has led to catastrophic losses of more than $600 billion in the United States over the last two decades, roughly twice the losses of the previous 40 years combined.†While the events associated with climate are more accurately described as “human-made†rather than “natural†disasters, a 2023 Washington Post article reports that, “U.S. insurers have paid out $295.8 billion in natural disaster losses from 2020 to 2022, a record for a three-year period.†This has led to dramatic changes in the cost of insurance coverage and the decision of many carriers to deny coverage.
The Washington Post writes, “At least five large U.S. property insurers — including Allstate, American Family, Nationwide, Erie Insurance Group and Berkshire Hathaway — have told regulators that extreme weather patterns caused by climate change have led them to stop writing coverages in some regions, exclude protections from various weather events and raise monthly premiums and deductibles.†In an analogous context of safety standards for automobiles and consumer protection, Ralph Nader has written for decades and most recently in a 2023 piece, Insurers Can Be Sentinels for  Health and Safety, saying: “Insurance executives began to view themselves more as heads of financial companies than as underwriting companies pressing for safer factories, automobiles, building codes, fire prevention and other ‘loss prevention’ attentiveness.” This is distinguished from insurers during the Industrial Revolution, as Mr. Nader describes: “As factories were being built in the 1800s with boilers prone to exploding and starting fires, the early property insurance companies hired engineers to develop upgrades in boiler design and construction. Insurers would only provide coverage to companies that met the new standards. That is how the industry defined ‘risk management.’ Dangerous factory boilers meant unacceptable insurance losses.” With prodding from Mr. Nader and allied advocates in the late 1980s, some insurers did embrace a “loss prevention†strategy like this for auto safety.Â
Given the urgent need for transformational climate-sensitive practices, there is a role for homeowner insurance underwriters to join the campaign to transition all land management, including agricultural and nonagricultural lands, to organic practices. This will eliminate the very inputs that contribute to the climate crisis and at the same time recognize the extreme value of organic soil systems in drawing down atmospheric carbon—with companies insuring only those land management practices that effectively contribute to severe “loss prevention” or avoidance of climate disasters.
>> Regenerative agriculture must be organic.
Agriculture is a major contributor to climate change. In a recent article in Science, Clark et al. show that even if fossil fuel emissions were eliminated immediately, emissions from the global food system alone would make it impossible to limit warming to 1.5°C and difficult even to realize the 2°C target.
Why do homeowner insurers need to pick up the mantle of organic land management? The current patchwork of state insurance regulations means that either insurance companies leave the home insurance market in areas most directly affected by the climate crisis (e.g., coastal, floodplain, and fire-prone areas) or raise prices. As home purchasers know, mortgage lenders require homeowner insurance to obtain a loan. In the pricing paper cited above, the authors show that the entire country bears the brunt of high and rising insurance costs due to the climate crisis. In other words, one does not have to live in a high hazard area to face high and increasing insurance costs. The authors state: “In this paper, we provide evidence of decoupling of insurance rates from their underlying risks and identify regulation as a driving force behind this pattern. We identify two sources for this decoupling. First, rates have not adequately adjusted in response to the growth in losses in states we classify as “high frictionâ€, i.e. states where regulation is most restrictive. Second, in low friction states rates increase both in response to local losses as well as to losses from high friction states. Importantly, these spillovers are asymmetric: they occur only from high to low friction states, consistent with insurers cross-subsidizing in response to rate regulation. Our results point to distortions in risk sharing across states, i.e. households in low friction states are in-part bearing the risks of households in high friction states.â€
The insurance industry has already recognized the reality of the climate crisis and the threat that it represents. The question now is whether the insurance industry will join efforts that force a transition to organic practices and support policies that facilitate this transition. Currently, the focus is on amendments in the Farm Bill, among other legislation, that could either contribute to an escalating climate crisis or help to curtail it.
Climate change is a real crisis and requires serious action. Actually, climate change is one of multiple crises that are compounding one another. While climate change may be most apparent—128o F in Death Valley, heat waves in India, the U.S., and globally, the earliest Category 5 hurricane on record, another wildfire season, etc.—the climate emergency intersects with crises in human disease and biodiversity collapse.Â
Heat makes the health effects of pesticides more serious. Climate change is intensifying the impacts of habitat destruction and toxic chemicals on biodiversity. We cannot afford to let anyone capitalize on marketing schemes making false claims of climate change mitigation. Â
>> Regenerative agriculture must be organic.Â
Organic agriculture can mitigate climate change. According to the International Panel of Climate Change, agriculture and forestry account for as much as 25% of human-induced greenhouse gas (GHG) emissions. The contribution of animal agriculture has been estimated at 14.5% to 87% or more of total GHG emissions. These estimates include emissions of carbon dioxide, methane, nitrous oxide, and ammonia. The carbon dioxide contribution largely comes from converting land from natural forest to pasture or cropland. Â
“Regenerative†agriculture is widely considered to be a solution for reducing or even reversing these impacts. Unfortunately, a movement by promoters of chemical-intensive agriculture has misled some environmentalists into supporting toxic “regenerative†agriculture. While recognizing practices that sequester carbon in the soil—practices that are central to organic agriculture—the so-called “regenerative agriculture†promoted by these groups ignores the direct climate impacts of synthetic nitrogen fertilizers, the damage to soil health caused by pesticides and chemical fertilizers, and the fact that pesticide and fertilizer manufacturing is dependent on fossil fuels—as key ingredients as well as for the heat and energy driving chemical reactions. It is important to see through this deception. Â
Organic practices preserve natural lands and biodiversity. Natural forests are more effective than tree plantations in sequestering carbon. Preserving natural land increases biodiversity, which also reduces dependence on petroleum-based pesticides. Organic farms are required to “comprehensively conserve biodiversity by maintaining or improving all natural resources, including soil, water, wetlands, woodlands, and wildlife, as required by § 205.200 of the regulations and per the §205.2 definition of Natural resources of the operation.â€â€¯Â
Organic agriculture benefits human health. By avoiding the use of antibiotics and toxic pesticides, organic agriculture protects farmworkers and consumers. In addition, studies have found organically grown plant foods and milk to be nutritionally superior to those produced by chemical-intensive agriculture. Â
The National Organic Program provides for clarity and enforceability, while providing processes that are open and transparent to growers, consumers, and the public at large. As an established program, it also has its own funding mechanism. We must demand that any definition of “regenerative†must—at a minimum—meet organic standards. Â
>> Regenerative agriculture must be organic.Â
It is crucial, as we move forward with a plan to harness agriculture in the fight against the climate emergency, biodiversity collapse, and health threats, that we not be misled into promoting the same practices that have created the problem. As aptly stated by Jeff Moyer of the Rodale Institute, “We believe that in order to be regenerative, you have to start by being organic. It’s a little disingenuous to say you can regenerate soil health and sequester carbon and still use nitrogen fertilizers and synthetic pesticides. What you’re really saying is equivalent to saying ‘I want to be healthy as a person, but I still want to smoke cigarettes.'” Â
The climate crisis and the devastating decline in biodiversity are escalating because of uncontrolled and unnecessary reliance on toxic chemicals. These threats to life require a meaningful holistic strategy to end our fossil fuel dependence and use of materials that release harmful levels of noxious gases (including greenhouse gases).  Â
Agriculture must—across the board and on an expedited five-year schedule—shift to organic practices. Organic practices both sequester carbon and eliminate petrochemical pesticides and synthetic fertilizers. Importantly, the data show that organic agriculture now operates without sacrificing productivity or profitability. While the vested economic interests in the petroleum and chemical industry cling to the status quo, there are good jobs and money to be made in a green economy. Â
We need a national plan to shift to 100% organic farming. Organic land management is more effective at reducing emissions and sequestering carbon in the soil. There is already a national program for certifying farms that meet organic standards. Organic operations must “comprehensively conserve biodiversity by maintaining or improving all natural resources, including soil, water, wetlands, woodlands, and wildlife.â€â€¯â€¯Â
Undefined and unenforceable “regenerative†agriculture falls short by ignoring the direct climate impacts of nitrogen fertilizers, the damage to soil health and ecosystem services caused by pesticides and chemical fertilizers, and the fact that pesticide and fertilizer manufacturing is dependent on fossil fuels—as key ingredients and for the heat and energy-driving chemical reactions.  Â
We need a national land management plan.  Preserving natural land increases biodiversity, reduces dependence on petroleum-based pesticides, and is more effective in sequestering carbon. Biodiversity buffers against damage from climate change by allowing systems to evolve with changing conditions. Preserving natural lands and transitioning farms to organic production should be the cornerstones of combating climate change.  Â
>> Regenerative agriculture must be organic.Â
Letter to Congress:
As Congress considers elements of the next Farm Bill, climate change is an extremely urgent crisis to address. And while climate change may be most apparent—128o F in Death Valley, heat waves in India, the U.S., and globally, the earliest Category 5 hurricane on record, another wildfire season, etc.—we are also facing crises in human disease and biodiversity collapse.
Heat makes the health effects of pesticides more serious. Climate change is intensifying the impacts of habitat destruction and toxic chemicals on biodiversity.Â
We cannot afford to let anyone capitalize on marketing schemes making false claims of climate change mitigation. Regenerative agriculture must be organic. 
Organic agriculture mitigates climate change and therefore must be dramatically expanded. Agriculture is a major contributor to the climate emergency. Research shows that even if fossil fuel emissions were eliminated immediately, emissions from the global food system alone would make it impossible to limit warming to 1.5°C and difficult even to realize the 2°C target. According to the International Panel of Climate Change, agriculture and forestry account for as much as 25% of human-induced greenhouse gas (GHG) emissions.Â
“Regenerative†agriculture is widely considered to be a solution for reducing or even reversing these impacts. Unfortunately, a movement by promoters of chemical-intensive agriculture has misled some environmentalists into supporting toxic “regenerative†agriculture. While recognizing practices that sequester carbon in the soil—practices that are central to organic agriculture—the so-called “regenerative agriculture†promoted by these groups ignores the direct climate impacts of synthetic nitrogen fertilizers, the damage to soil health caused by pesticides and chemical fertilizers, and the fact that pesticide and fertilizer manufacturing is dependent on fossil fuels—as key ingredients as well as for the heat and energy driving chemical reactions. It is important to see through this deception. 
Organic farms are required to “comprehensively conserve biodiversity by maintaining or improving all natural resources, including soil, water, wetlands, woodlands, and wildlife.â€â€¯
Organic agriculture benefits human health. By avoiding the use of antibiotics and toxic pesticides, organic agriculture protects farmworkers and consumers. In addition, studies have found organically grown plant foods and milk to be nutritionally superior to those produced by chemical-intensive agriculture. 
The National Organic Program provides clarity and enforceability while providing processes that are open and transparent to growers, consumers, and the public at large. As an established program, it also has its own funding mechanism. Any definition of “regenerative†must—at a minimum—meet organic standards. 
The climate crisis and the devastating decline in biodiversity are escalating because of uncontrolled and unnecessary reliance on toxic chemicals. These threats to life require a meaningful holistic strategy to end our fossil fuel dependence and use of materials that release harmful levels of noxious gases (including greenhouse gases).  
We need a national plan to shift to 100% organic farming in the coming five years. Please support a shift to organic in the Farm Bill and reject language that (i) undermines, or preempts, local and state authority to enact more stringent land management policies protective of health and the environment, and (ii) establishes immunity from lawsuits for chemical companies that fail to warn farmers and consumers of pesticide hazards.  
Thank you.
