Often the influence of big industry on climate science has been associated with attempts to tone down the effects of anthropogenic climate change. However, the reverse may be equally true: when unsettled science is exaggerated, it can easily become a perverse tool for larger industry profit. An example is coming into view with (re)insurance companies and the science on hurricane activity. Hat tip to Roger Pielke Jr. whose blog provided most of the pieces to stitch the story together.
And then, in 2005, hurricane Katrina hits New Orleans.
Two part series on Bermuda's control over insurance rates | Ocala.com
Emphasis mine. Commonly, insurance premiums get raised in the wake of a massive natural disaster. But the article remains vague on the role of the mentioned scientists, and who these scientists were.
Well known is that Risk Management Solutions, an influential company assessing the risks of natural disasters, providing risk models for insurance and reinsurance companies, released early 2006 a risk assessment for hurricane damage for the 2006-2010 period.
That paper is found here. This sentiment was riding high in the wake of the well-publicized Webster et al. publication in Science, which was published in 2005, just weeks after hurricane Katrina had ravaged New Orleans.
That's one piece of the set. It gets a bit messier from here for a second piece, as it wades into another climate war battle front. The main author of the above, dr. Muir-Wood, chief research officer at RMS, also released a white paper at a 2006 conference in Germany, arguing that there is already a 2% increase in normalized losses for the period associated with increased global temperatures.
This publication, while not part of the official science literature and thus not having passed through independent peer-review, was included in the 2007 IPCC Fourth Assessment Report (Working Group II), was prominently referenced there and formed the single foundation of the argumentation that normalised catastrophe loss was on the increase with 2%. Note that for this particular IPCC chapter, Muir-Wood has been credited as a contributing author. The relevant excerpt:
Emphasis mine. The mentioned figure SM1.1 was the following graph (in the supplementary material), and again cited the 2006 Muir-Wood publication as source.
Of course a caveat applies here - it's not just hurricanes responsible for increased losses - but they are considered part of it.
So far so good? It gets more messy from here. Early this year, the above figure gained some blog prominence as it became part of the furore surrounding the criticisms levelled at the IPCC for faulty work and mistakes, including on financial losses by natural disasters - and most, but not all, of the history of both the inclusion of the 2006 Muir-Wood publication as well as the controversial figure have been mapped out since.
Because while accredited to it, the IPCC figure above isn't included in the 2006 Muir-Wood publication - as everyone can see for oneself. The data underpinning the figure can't all come from the 2006 publication either.
The 2006 Muir-Wood paper was, as usually happens in science, refurbished and incorporated as a book chapter - published in 2008, with Stuart Miller as first author and dr. Muir-Wood the second author. But the above IPCC figure wasn't included in that publication either.
So where does this figure comes from? Although not conclusively solved, there are some good clues. During the Second Order Draft of the chapter, the expert critics were heckling the inclusion of a figure 1.5 from an unpublished study by Miller in 2006. Miller 2006, however, has never appeared, and became the Miller 2008 book publication - which does feature a similar figure of figure 1.5.
In response to the expert critics, the author team responsible for the chapter writes:
Based on this it has been suggested that it was the actual Writing Team of the IPCC chapter which independently changed the presentation of the graph from an unpublished publication (which for that very reason should not have been included in the A4R), then mis-cited the 2006 Muir-Wood publication as the source. As a contributing author of the IPCC chapter and second author of the Miller paper, Muir-Wood may actually have provided the initial figure 1.5 that then was altered in presentation and was added to the IPCC report. Nevertheless, this is all rather awkward coming from an authoritative body like the IPCC, and I can only see it as a faux-pas at best.
In the wake of the criticism early this year, both dr. Muir-Wood and his employer RMS have admitted that, even while the 2006 Muir-Wood paper was well reflected in the chapter, the notorious graph should not have been included in the IPCC report. The IPCC sees no problem, however.
It gets worse, though. Pielke Jr., a professor of environmental studies and in a turf war about this issue, was quick to point out that the 2008 Miller publication negated the very conclusions drawn in the 2006 Muir-Wood publication:
Most notably Miller et al. concluded the abstract with the following remarkable conclusion:We find insufficient evidence to claim a statistical relationship between global temperature increase and normalized catastrophe losses.The full text states:In sum, we found limited statistical evidence of an upward trend in normalized losses from 1970 through 2005 and insufficient evidence to claim a firm link between global warming and disaster losses.
Which rendered the 2006 Muir-Wood conclusion, and thus the entire IPCC argumentation stacked on it, entirely moot - something the Writing Team also could have avoided if they had fully incorporated the criticisms received during the drafting of the chapter.
So, unless there are more "scientists hired by the insurance industry" matters stand as following: 1) the authors of the controversial graph in the IPCC, referenced to a publication that was not published nor peer-reviewed and in which the figure wasn't even included, have admitted that the figure shouldn't have been inserted into the IPCC report; and 2) the argument of a 2% increase in normalised losses from natural disasters since 1970 was found to be statistically insignificant by the same authors in a later publication anyway.
Of course this does not mean that disaster losses have no link whatsoever with the effects of anthropogenic global warming, but that, if such a link actually exists, it hasn't been showing in the data available so far - and this attribution hasn't been shown in more recent science publications either. It is however a crucial sort of detail - and I bet it would be important for the insurance industry.
But before 2010 came along, the analysis by the RMS, its subsequent prediction for hurricane losses for the 2006-2010 period, the hasty (and incorrect) vindication of the RMS analysis in the IPCC A4R report and the echoes in the public press with these findings following the disaster of hurricane Katrina, all delivered perfect grounds for (re)insurance companies to raise premiums. Which is exactly what happened.
So, on the piece left untouched, the RMS prediction for financial damage for the 2006-2010 period, how is that coming along, some 4 years later? As the 2010 Hurricane season is winding down (it officially closes on 30 November), results of the yearly damage assessment have been drawn up by Pielke Jr.:
Pielke Jr. published in 2008 an article, in which he wrote that:
Add another one to the pile.
In the meantime, things are swell in Bermuda, hurricane or no hurricane, while Florida is getting sucked dry...