Washington DC (PRWEB) November 1, 2005
Action Fund Management LLC (AFM), investment adviser to the Free Enterprise Action Fund (http://www.FreeEnterpriseActionFund.com), asked five insurance companies that it owns to conduct independent analyses of allegations that global warming will increase weather-related losses.
“We believe environmental activists and their Left-leaning institutional investor allies are trying to take advantage of recent natural disasters like Hurricanes Katrina, Rita and Wilma to pressure insurance companies into supporting the Kyoto Protocol and other mandatory restrictions on greenhouse gases,” said AFM’s Steve Milloy.
The Free Enterprise Action Fund (FEAF) is a mutual fund seeking to provide investors with financial returns while persuading companies to focus on increasing shareholder value and profits rather than appeasing outside activists.
AFM sent letters to the American International Group (AIG), Chubb Corporation (CB), Hartford Financial Services Group, Inc. (HIG), Progressive Corporation (PGR) and St. Paul Travelers Companies (STA). The FEAF owns less than one percent of the common stock of these companies.
FEAF’s request was spurred by a new report by the Center for Science and Public Policy (CSPP) that concludes global warming is not responsible for increases in weather-related economic losses. (1)
“The bottom line is that currently there is no scientific basis for attributing any part of the global, decades-long trend of an increasing number of disasters and disaster losses to changes in climate, irrespective of the reasons for those changes. Those who perpetuate such claims, whether they are in the reinsurance industry, the UN, advocacy groups, or the scientific community, are either ill-informed or dishonest,” concludes the report citing the words of University of Colorado climate researcher Dr. Roger Pielke.
The CSPP report directly contradicts a September 2005 claim by the environmental activist group Ceres that insurers are at financial risk from global warming. (2)
“We are urging insurers to refrain from establishing a corporate policies concerning climate change until they conduct their own detailed review of the pertinent data and information,” said AFM’s Tom Borelli. “We also asked the companies to report their findings to shareholders,” added Borelli.
“Corporate managers, in our view, should base their decisions on sound science and economics, rather than pressure from external groups who may have agendas that run counter to what’s in the best interests of a business and its shareholders,” said Milloy.
“It could very well be that what the insurance industry needs to do to reduce weather-related losses is to write better policies and charge appropriate premiums for risky coastal development,” Milloy said. “The insurance industry needs to do its own thorough analysis of the situation, rather than falling for alarmist reports from activist groups.”
“It’s apparent to us that investing has become politicized,” Borelli said. “Activists seem to see publicly-owned corporations as a means to implement their social and political agendas. That may explain why global warming activists are seeking to influence insurers," observed Borelli.
“In contrast, we see businesses as society’s engines for generating wealth. That’s why we created the Free Enterprise Action Fund – to keep business focused on increasing shareholder value, rather than the political power of social activist groups,” Borelli explained.
The Free Enterprise Action Fund seeks long-term capital appreciation through investment and advocacy that promote the American system of free enterprise. An investor should consider the fund's investment objectives, risks, and charges and expenses carefully before investing or sending money. This and other important information about the Free Enterprise Action Fund can be found in the fund's prospectus. To obtain a prospectus, please call 1-800-766-3960 or visit http://www.FreeEnterpriseActionFund.com. Please read the prospectus carefully before investing.
Equity securities (stocks) are more volatile and carry more risk than other forms of investments, including investments in high-grade fixed income securities. The net asset value per share of this Fund will fluctuate as the value of the securities in the portfolio changes. The Free Enterprise Action Fund is a new fund with limited investment history and there is no guarantee that it will achieve its investment objectives.
The Free Enterprise Action Fund is advised by Action Fund Management, LLC., which receives a fee for its services, and is distributed by BISYS Fund Services Limited Partnership, which is not affiliated with Action Fund Management, LLC.
1. “Climate Change and the Insurance Industry,” The Center for Science and Public Policy, Washington, DC (October 2005): http://ff.org/centers/csspp/pdf/ceres.pdf.
2. “Availability and Affordability of Insurance Under Climate Change: A Growing Challenge for the U.S,” Ceres, Boston, MA (September 2005): http://www.ceres.org/pub/docs/Ceres_insure_climatechange_090805.pdf.