Eight of the world’s largest insurance and reinsurance businesses formed an alliance to help accelerate the shift towards a zero-emissions economy. According to the companies, which include Europe’s leading three insurers by premiums, Allianz (ALVG.DE), AXA (AXAF.PA), and Generali (GASI.MI), the Net-Zero Insurance Alliance (NZIA) will seek to move underwriting portfolios towards net-zero greenhouse gas emissions by 2050.
The initiative comes as insurers face mounting pressure to explain how they aim to decarbonize their companies in the midst of rising pressure to stop underwriting and participating in fossil fuel projects. The members of NZIA released a statement saying that every company has to set its intermediate targets and goals regarding net-zero emission for every five years and is required to progress through the climate goals and report on the progression annually in collaboration with competition regulators.
Thomas Buberl, Chief Executive of the AXA Group, which heads the NIZA, said, “With this new Net-Zero Insurance Alliance, we are raising our climate ambition further”. Members of the NZIA, which include Aviva (AV.L), Munich Re (MUVGn.DE), SCOR (SCOR.PA), Swiss Re (SRENH.S), and Zurich Insurance Group (ZURN.S), will set underwriting principles for the most carbon-intensive actions in their underwriting portfolios and provide solutions for low-emission and zero-emission techniques. Their risk management frameworks will also include net-zero and decarbonization risk guidelines.
Mark Carney, climate envoy from the UN said, “By committing to join the gold standard alliance for net zero, the (NZIA) will ultimately make underwriting contingent on underlying companies having credible net-zero transition strategies”. Generali CEO Philippe Donnet unveiled the Alliance, which was first outlined in April, during the G20 Climate Summit in Venice on Sunday. Most of Europe’s top insurers have already implemented climate-friendly policies. Generali also announced last month that by 2050, it will achieve carbon neutrality in its direct investment portfolio.
