Itzchak KornfeldFaculty of Law, The Hebrew University of Jerusalem

Kornfeld.itzchak@mail.huji.ac.il

Boston College Who Will Pay: The Public & Private Insurance Implications of Climate Change's Drastic

Challenges. 11/5/2015

DROUGHT & LOSS OF USE INSURANCE COVERAGE

CHARITY HOSPITAL, NEW ORLEANS POST-KATRINA

CHARITY HOSPITAL NEW ORLEANS POST-KATRINA

COUNT/TENET OFFICE BUILDING

INSIDE CHARITY HOSPITAL NEW ORLEANS POST-KATRINA

● Loss of Use Coverage

● Business Interruption Coverage

DROUGHT IS NOT INSURABLE!

THE EFFECTS OF DROUGHT MAY BE

THE EFFECTS OF DROUGHT

THE EFFECTS OF DROUGHT

CLIMATE CHANGE & INSURANCE

By 2100 temperatures will increase by at least 10 degrees

Severe heat will cause “occurrences” of property damage to real and tangible property. More often than not that tangible property will be crops, fruit trees and livestock.

CGL PROPERTY DAMAGE DEFINITION

a) Physical injury to tangible property, including all resulting loss of use of that property. All such loss of use shall be deemed to occur at the time of the physical injury that caused it; or

CGL PROPERTY DAMAGE DEFINITION

b) Loss of use that is not physically injured. All such loss of use shall be deemed to occur at the time of the “occurrence” that caused it.

CGL OR “OCCURRENCE” BASED POLICIES

"Bodily injury" or "property damage" will be deemed to have been known to have occurred at the earliest time when any insured listed under Paragraph 1. of Section II – Who Is An Insured or any "employee" authorized by you to give or receive notice of an "occurrence" or claim:

2004 CGL POLICY LANGUAGE RE: WHAT INSURED KNEW AND WHEN THE INSURED KNEW IT

:

b. This insurance applies to “bodily injury” and “property damage” only if:

(1) The “bodily injury” or property damage” is caused by an “occurrence” that takes place in the “coverage territory”;(2) The “bodily injury” or “property damage” occurs during the period

2004 CGL POLICY LANGUAGE RE: WHAT INSURED KNEW AND WHEN THE INSURED KNEW IT

The "occurrence" CGL is triggered when the bodily injury or property damage is deemed to have occurred. 

BUT IN A DROUGHT WHEN IS THE OCCURRENCE?

At time of Prediction/Forecast?

At time of prediction of drought?

At time when a structure, e.g., a hot house, begins to crack from the heat or when it is totally destroyed?

ECHO BAY: LAKE MEAD'S ECHO BAY MARINA LIES ABANDONED IN MUD ABOVE THE WATER LINE

AT TIME WHEN WATER OF A LAKE PARTIALLY DRIES UP OR TOTALLY, SO BOAT RENTERS CAN’T ROW?

HIGH AND DRY: THE LAKE PALACE IN UDAIPUR, INDIA, IS SURROUNDED BY MUD AFTER THE WATER DRIED UP DUE TO DROUGHT

WHEN IS THE OCCURRENCE? AT TIME THE GOVERNMENT SHUTS DOWN WATER?

OR WHEN % OF FISH DIE?