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In a pair of little-noticed letters sent earlier this year, Ohio Senator Sherrod Brown and five other Democratic senators asked two giant organizations crucial to keeping the country’s housing market running how they were preparing for the destructive power of climate change. “If we are underprepared, climate change could have particularly devastating impacts on the individuals and communities who can least afford it,” the letter warned Fannie Mae and Freddie Mac, the government-supported companies that back roughly half of the country’s $10 trillion mortgage market.

The financial world and those responsible for regulating it have been waking up to the threat posed by global warming. Earlier this year, the head of the world’s largest investment firm, BlackRock, said that climate change is causing a “fundamental reshaping of finance.”

And as investors, bankers, and others in finance accept that they must rethink how they operate, some insurance companies and lenders are responding by reducing their risks to flooding, wildfires, and other natural disasters. It’s a shift likely to […]