Pre-register for the Insurance & Climate Risk Policy Brief | Finance Watch

Pre-register for the Insurance & Climate Risk Policy Brief

In January, Finance Watch will publish a policy brief on the pivotal role the insurance sector plays in the global climate transition.

The brief delves into the sector’s dual-sided relationship with climate change, from profit-driven investments in fossil fuels to the increasing transfer of the cost of the protection gap to consumers. As the planet grapples with intensifying climate consequences, insurers must redefine their role, transitioning from contributors to mitigators of this crisis.

We explore the critical need for insurers to lead the charge, not just through divestment but by actively promoting and supporting a comprehensive shift to net-zero practices.

Some key messages in this report:

  • As of today, consumers are paying the price of the protection gap, while insurers keep profiting from fossil fuel investments.
  • Insurers must account for all forms of Scope 3 emissions, including underwriting.
  • Real-world impact must be prioritised through absolute GHG emission reductions.
  • Insurers should herald the transition through active engagement with counterparties.
  • Transition plans must be included explicitly in prudential rulebooks, empowering supervisors to impose penalties on insurance companies not aligned to the goals of the Paris Agreement.