Revealed – prime fossil gas insurers

The Insure Our Future marketing campaign warns in the present day in its seventh annual scorecard on insurers’ local weather insurance policies that regardless of the insurance coverage business’s preliminary warnings concerning the local weather emergency 50 years in the past, insurers are nonetheless contributing to the disaster by supporting fossil gas tasks.

Most insurers proceed to again tasks that enhance oil and gasoline manufacturing, a stance incompatible with the 1.5°C Paris local weather goal set by main local weather scientists. In line with analysis by Insuramore, fossil gas insurance coverage earned the business round $21.25 billion in 2022.

Insuramore estimates that insurers at Lloyd’s of London collectively underwrite probably the most fossil gas insurance policies, with estimated annual premiums ranging between $1.6-$2.2 billion. The highest 10 insurers within the fossil gas sector are as follows:

Prime 10 fossil gas insurers in 2022

Pure disasters like floods, hurricanes, wildfires, and droughts have led to a surge in insurance coverage payouts, averaging $110 billion yearly since 2017. Nonetheless, insurers at the moment are declining to insure owners within the riskiest markets.

Munich Re, the primary to warn concerning the local weather dangers in 1973, noticed that rising temperatures would result in environmental adjustments. Nonetheless, regardless of these warnings, fossil gas consumption and CO2 emissions proceed to rise. 1000’s of recent fossil gas tasks are in progress, posing a risk to limiting international warming to 1.5°C.

Local weather change’s results on insurance coverage

The International Vitality Monitor reviews quite a few proposed or under-construction fossil gas tasks, together with coal, oil, and gasoline extraction tasks, coal energy vegetation, LNG import terminals, gasoline, and oil pipelines, amongst others.

Insurers are experiencing elevated monetary dangers on account of local weather change. Reinsurance capital decreased by 20-25% in 2022, inflicting a spike in premiums. Main insurers like AIG Re, AXIS Capital, AXA XL, Everest Re, and SCOR decreased cowl or withdrew from the property market.

In response to escalating local weather disasters, major insurers masking over two-fifths of California’s dwelling insurance coverage market have withdrawn. State Farm, Allstate, Chubb, Tokio Marine, AIG, and Berkshire Hathaway’s AmGUARD are amongst people who left, impacting house owner vulnerability and property values.

Main insurers that joined the Internet Zero Insurance coverage Alliance have additionally confronted criticism for not fulfilling their commitments. Twenty out of 31 members left the alliance beneath the specter of anti-trust motion within the US. Just a few have printed transition plans and internet zero targets, failing to undertake targets to cut back their absolute insured emissions by 34%.

“The insurance coverage business first warned about local weather dangers in 1973, and these have now change into a grim actuality, notably for low-income international locations and communities which have contributed least to the local weather emergency. Insurance coverage corporations at the moment are abandoning clients affected by local weather dangers, but they proceed to gas the local weather disaster by underwriting and investing within the enlargement of fossil fuels,” Insure Our Future international coordinator Peter Bosshard mentioned.

“If insurance coverage corporations took local weather science critically, they might absolutely align their underwriting and funding methods with a reputable 1.5°C pathway and finish all help for elevated fossil gas manufacturing. They’d be suing fossil gas corporations, to make polluters pay for the rising prices of local weather disasters and preserve insurance coverage reasonably priced for climate-affected communities,” Bosshard mentioned.

“A logo of insurers’ failure”

The 2023 Scorecard on Insurance coverage, Fossil Fuels, and the Local weather Emergency, a report collated by 22 organisations throughout 12 international locations, extensively evaluates the local weather insurance policies of 30 main insurers. Notably, the present report incorporates a vital symbolic gesture, leaving the highest three locations vacant in its rating desk, emblematic of insurers’ inadequate response to the continuing local weather emergency.

Within the evaluation of fossil gas insurance coverage insurance policies, Allianz leads the rankings for its complete strategy, with Generali, Aviva, and Swiss Re following intently behind.

When evaluating coal Insurance coverage, Allianz stands as the only firm with an ideal 10/10 rating, adopted by AXA, Swiss Re, and Generali, illustrating their distinguished insurance policies on this sector.

Regarding oil & gasoline insurance coverage, Aviva and Generali showcase sturdy limitations, although their scores are at 4.0/10. Notably, these corporations, alongside German insurers Allianz, Hanover Re, Talanx, and Munich Re, positioned at third, 4th, sixth, and seventh locations respectively, have ceased new insurance coverage for oil and gasoline manufacturing with few main exceptions.

Nonetheless, not one of the 30 insurers have terminated protection for brand new gasoline energy vegetation, and solely a minimal few have withdrawn help for the upcoming surge of liquefied fossil gasoline (LNG) terminals.

“Insurers discuss loads concerning the want for oil and gasoline corporations to transition away from fossil fuels. In actuality, they aren’t advocating for a transition away from fossil gas extraction however are happy if fossil gas corporations undertake shallow internet zero commitments, shift from coal to gasoline extraction, put money into renewable vitality tasks and scale back their operational emissions. This does nothing to cut back the local weather impression of burning the oil and gasoline these corporations promote, which is by far the largest a part of their life-cycle emissions,” the scorecard mentioned.

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