Impacts of climate factors on UK insurance companies: evidence from the stock prices

Climate change poses significant risks to the insurance industry, particularly through increased frequency and severity of weather events. In this paper, we examine the extent to which temperature, wind speed, and rainfall influence the stock prices of companies listed on the UK stock market. By using data of 1. Andrews Sykes Group plc. (ANSY) 2. Aviva plc (AVIVA) 3. Legal & General Group plc (LGEN) 4. Prudential plc (PRU) 5. Direct Line Insurance Group plc (DLGD) and conducting the multiple linear regression model and random forest model, the findings, illustrated through scatterplots, indicate a weak relationship and correlation between the dependent (stock prices) and independent variables (weather data), as shown by the P-values and R-values.