I'm all for the health of the planet and its people, but I callinto question recent calls for a regulation to make theproperty-casualty insurance industry an environmental trafficcop.

Last October, a subcommittee of the U.S. Senate Committee onBanking, Housing and Urban Affairs held a hearing on “ClimateDisclosure: Measuring Financial Risks and Opportunities.” Severalexperts testified, including Mindy Lubber, president of Ceres(pronounced “series”), an organization whose mission is to“integrate sustainability into capital markets for the health ofthe planet and its people.”

Ms. Lubber's testimony focused on why corporate climate riskdisclosure is essential for investors, and she made some goodpoints. For example, she noted that shareholders have an interestin knowing that an energy company is about to build a coal-firedpower plant.

But I was astonished when that point was directly followed by areference to the insurance industry and its “painfully low [climaterisk] disclosure rate.” In one brief statement, she linked coalpower–the poster child of greenhouse gas emissions–toinsurance.

What motivates Ceres to apply the same broad brush to insurersand energy companies when painting a picture of corporate climaterisk disclosure? And what policies will result if Ceres persuadeslawmakers and regulators insurance is no different from the energyand automotive industries with respect to global warming?

The premise behind the view Ms. Lubber expressed to Congress isas simple as it is wrong–that property-casualty insurers, asregulated financial entities that assess and manage risk, should becompelled to take on special responsibilities to leverage betterenvironmental behavior among the people and corporations theycover.

In other words, it's easier to regulate the causes of globalwarming through a one-off approach using the insurance industrythan it is to regulate them directly.

Now this view is beginning to play out in policy and regulation,as Ceres has clearly captivated the National Association ofInsurance Commissioners' Climate Change and Global Warming TaskForce.

Earlier this year, the task force released a draft Climate RiskDisclosure Proposal that would require all U.S.-domiciled insurersto answer a lengthy set of “climate risk disclosure”interrogatories–drafted largely by Ceres–to be included in theAnnual Financial Statement. The following questions aretypical:

o “What actions have you taken to assess the impact of climaterisk and global warming on your operations?

o What are the results of your assessments of the impact ofclimate risk and global warming?”

Robert Detlefsen, Ph.D, vice president of public policy for theNational Association of Mutual Insurance Companies, said “thesehighly tendentious questions assume insurers have knowledge ofthings that are, in fact, unknowable.”

“While many property-casualty insurers face challenges anduncertainties due to the risk posed by large-scale naturaldisasters, no company is in a position to assess the risk posed byclimate change per se,” he added. “Given the current state ofclimate science, insurers can do no more than speculate about thenature and extent of risks attributable to climate change.”

NAMIC and others in the industry have long advocated smarterland-use planning, stronger building codes and robust building codeenforcement to mitigate the losses caused by natural disasters.

NAMIC is, in fact, the leader of the building code coalition inWashington, D.C.–a coalition that helped produce legislationrecently introduced in the U.S. House of Representatives (HR 3926)that would provide incentives for states to strengthen and enforcebuilding codes.

In addition, more than 15 months ago, NAMIC established a Website (www.climateandinsurance.org) as a resource for industryprofessionals to learn more about climate change and its possibleimplications for the p-c industry.

But our advocacy and implementation of such meaningful andpractical measures seem unlikely to satisfy Ceres and its allies atthe NAIC.

Considered from another angle, if investors require additionalinformation to assess the impact of climate change on publiclytraded companies, let it be required through securities regulationor the shareholder proxy process.

However, regulators should not require the insuranceindustry–including the greater than 30 percent share ofmutual/nonpublic insurers–to be subjected to these rules.

As for the NAIC, if it wishes to play a constructive role byestablishing a dialogue with insurers about climate change, alogical starting point would be to ask insurers, in a voluntarysurvey, questions such as:

o “Do you consider climate risk to be separate and distinct fromwindstorms, wildfires and other weather-related risks that youinsure?”

o “Are there instances in which insurance regulation hindersyour ability to manage or mitigate these risks?”

NAMIC and its sister p-c trade associations suggested thisapproach to the Climate Change Task Force when it met at the NAIC'srecent spring meeting. I'm cautiously optimistic the group, led byWisconsin Insurance Commissioner Sean Dilweg and Pennsylvania'sJoel Ario, will consider helpful alternatives to the agenda-ladeninquisition authored by Ceres and company.

The climate challenges we are grappling with are embedded in thetension between economic growth and environmental impact, asmeasured by uncertain science. Proposed solutions come from publicpolicy decisions at all levels of government, from the UnitedNations' Kyoto protocol to local government land-use planning.

Regulators should not use the property-casualty insuranceindustry as the fulcrum to leverage environmental behavior.

Charles M. Chamness is president and CEO of the NationalAssociation of Mutual Insurance Companies in Indianapolis,representing some 1,400 member companies that underwrite 40 percentof the nation's property-casualty insurance premium.