Insurance coverage “triple whammy” a significant risk to folks and the planet – ShareAction

A current investigation performed by ShareAction, a charity centered on accountable funding, has scrutinized the practices of the world’s 65 largest insurance coverage corporations, revealing important shortcomings within the trade’s efforts to handle a “triple whammy” – international warming, environmental degradation, and human rights protections.

Titled “Insuring Catastrophe 2024”, the report dissects the insurance coverage sector’s position in underwriting and investing in ventures that exacerbate local weather change, hurt ecosystems, and neglect human rights. Notably, the examine uncovered that solely two insurers have pledged to keep away from underwriting 4 of the globe’s most contentious fossil gasoline initiatives.

As well as, a majority – two-thirds of the insurers – don’t have any insurance policies in opposition to underwriting corporations concerned in producing controversial weaponry, together with chemical and cluster munitions. Moreover, 30% of the evaluated insurers scored zero in growing insurance policies geared toward safeguarding pure environments and biodiversity.

Regardless of the insurance coverage trade yearly disbursing over $100 billion for claims associated to local weather change impacts like flooding, storms, and fires over the previous 4 years, investments and underwriting practices contributing to such disasters persist.

Claudia Grey, head of monetary sector analysis at ShareAction, expressed concern over the sector’s lack of accountability.

“This report reveals the insurance coverage sector’s abject failure to dwell as much as its duties to guard each folks and planet. They’ve each an ethical responsibility and enterprise alternative to undertake accountable investments and underwriting actions,” Grey mentioned.

Which insurers ranked the perfect throughout key requirements?

The report additionally options three league tables rating property and casualty insurers, life and well being insurers, and Lloyd’s of London managing brokers.

The evaluations, based mostly on 30 important requirements, spotlighted two French establishments, AXA Group and CNP Assurances SA, as comparatively excessive achievers, whereas declaring important underperformers like Lloyd’s of London and entities resembling Aegis Managing Company, Sony Monetary Group Inc, Nationwide Mutual Insurance coverage Co, and Protecting Life Insurance coverage Co, which scored poorly.

Jonathan Middleton, senior researcher at ShareAction, emphasised the pressing want for the insurance coverage trade to advance in the direction of sustainability.

“What these rankings present is simply how lengthy a journey the insurance coverage trade has to go on to satisfy internet zero targets, shield nature, and meet their obligations to safeguard human rights,” Middleton mentioned. “It is important that they start that journey instantly to make sure a sustainable future for each folks and planet, in addition to for the sake of their very own long-term viability.”

The investigation highlights a number of trade failings, together with insufficient insurance policies on human rights, well being, typical weapons, and indigenous rights. It additionally criticises the insurance coverage trade’s alleged inadequate consideration for biodiversity and factors out the reportedly weak insurance policies of the Lloyd’s of London market, a big participant in international fossil gasoline underwriting.

To deal with these challenges, “Insuring Catastrophe 2024” proposed 30 suggestions for insurers, urging complete transition plans aligned with a 1.5°C net-zero pathway, strong threat assessments, biodiversity insurance policies, and a transparent stance on Indigenous and local people rights.

The report additionally referred to as on policymakers and regulators to bridge the gaps the place the trade falls brief, aiming to catalyze a significant transition that safeguards each folks and the planet.

ShareAction plans to have interaction with the scrutinized insurance coverage corporations within the coming weeks to debate the findings and encourage a extra accountable strategy in the direction of environmental and social governance, it mentioned.

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