OTTAWA, ON and ARLINGTON, VA and SCHAUMBURG, IL and WASHINGTON, DC--(Marketwired - November 30, 2016) - Today, organizations representing the actuarial profession in Canada and the United States launched the Actuaries Climate Index (ACI), a quarterly measure of changes in extreme weather events and sea levels, available online at ActuariesClimateIndex.org. This index is based on analysis of quarterly seasonal data for six different index components collected from 1961 to winter 2016, compared to the thirty-year reference period of 1961 to 1990. The Actuaries Climate Index is an educational tool designed to help inform actuaries, public policymakers, and the general public about climate trends and their potential impact.
The Actuaries Climate Index looks at Canada and the continental United States, placed into 12 different regions. Higher index values indicate an increase in the occurrence of extreme weather events. The latest Actuaries Climate Index values show an increase in the impact of extreme weather events, such as high temperature, heavy precipitation, and drought.
The risk measured by the Actuaries Climate Index is relative to the average frequencies during the reference period of 1961-1990. The data is from neutral, scientific sources, generating objective, evidence-based results on extreme weather events. According to the data analysis, 1.02 is the current five-year moving average value for the index. The index value remained below 0.25 during the reference period, reached a value of 0.5 in 1998, and first reached 1.0 in 2013. These values indicate a sustained increase in the frequency of extreme weather occurrences and changes in sea levels.
David Dickson, President of the Canadian Institute of Actuaries, said, "The actuarial toolkit is quite unique. The profession wanted to demonstrate that actuaries and climate scientists could combine their education and training to come up with a tool that could be of use to governments, environmental groups, and scientists. I am convinced that we succeeded, and we will be working with our partners to add even more value to the index."
The Actuaries Climate Index was developed by the Climate Change Committee, which is a joint effort of the American Academy of Actuaries, the Canadian Institute of Actuaries, the Casualty Actuarial Society, and the Society of Actuaries.
"The Actuaries Climate Index is designed to provide objective data about changes in the frequency of extreme climate events over recent decades in Canada and the continental United States," said Doug Collins, Chair of the Climate Change Committee. "Actuaries are experienced in the assessment and mitigation of the financial consequences of risk, and we have developed the index for analyzing the climate."
The Actuaries Climate Index values for the most recent periods show the following:
- For Canada and the U.S. combined, the value for winter 2016 was 1.46, the sixth-highest level below the peak reached in the fall of 2015. The high value was caused primarily by high temperatures in eastern Canada and the northeastern U.S. as well as heavy precipitation in many locations.
- The current highest five-year average values by region are in the Northwest Pacific (British Columbia and Yukon Territory), Northeast Atlantic (New Brunswick, Newfoundland and Labrador, Nova Scotia, Prince Edward Island) and Southern Plains (Kansas, Montana, North Dakota, Nebraska, Oklahoma, South Dakota, Texas, and Wyoming).
Updates for values will be posted quarterly on ActuariesClimateIndex.org as data for each meteorological season becomes available. The organizations are also developing a second index, the Actuaries Climate Risk Index (ACRI), which will measure correlations between changes in the frequency of extreme events as measured by the index and economic losses, mortality, and injuries.
About the Sponsoring Organizations
The American Academy of Actuaries is an 18,500+ member professional association whose mission is to serve the public and the U.S. actuarial profession. For more than 50 years, the Academy has assisted public policymakers on all levels by providing leadership, objective expertise, and actuarial advice on risk and financial security issues. The Academy also sets qualification, practice, and professionalism standards for actuaries in the United States.
The Canadian Institute of Actuaries (CIA) is the national organization and voice of the actuarial profession. The Institute is dedicated to serving the public through the provision, by the profession, of actuarial services and advice of the highest quality. In fact, the Institute holds the duty of the profession to the public above the needs of the profession and its members.
The Casualty Actuarial Society (CAS) is a leading international organization for credentialing and professional education. Founded in 1914, the CAS is the world's only actuarial organization focused exclusively on property and casualty risks and serves over 7,000 members worldwide. Professionals educated by the CAS empower business and government to make well-informed strategic, financial and operational decisions.
With roots dating back to 1889, the Society of Actuaries (SOA) is the world's largest actuarial professional organization with more than 27,000 actuaries as members. Through research and education, the SOA's mission is to advance actuarial knowledge and to enhance the ability of actuaries to provide expert advice and relevant solutions for financial, business and societal challenges. The SOA's vision is for actuaries to be the leading professionals in the measurement and management of risk.
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