Insurers upping their game ahead of COP26

Insurers upping their game ahead of COP26

As the world heads toward the 2021 UN Climate Change Conference in Glasgow this November (COP26), the world’s insurers are stepping up their actions and raising their voices to ensure insurance is a key part of the conversation.

Seven of the world’s leading insurers and reinsurers, working together with the UN Environment Programme, are in the process of establishing a pioneering Net-Zero Insurance Alliance (NZIA).

The NZIA is expected to be launched at COP26. The companies are all signatories to the UN Principles for Sustainable Insurance (PSI) and are establishing the NZIA under the auspices of the UN Environment Programme’s PSI Initiative.

The seven companies – AXA (NZIA chair), Allianz, Aviva, Munich Re, SCOR, Swiss Re and Zurich Insurance Group – believe that the global insurance and reinsurance industry can play a key role in accelerating the transition to a resilient, net-zero emissions economy, in line with the 1.5°C target of the Paris Agreement on climate change.

By establishing the NZIA, these insurers are building on their climate leadership as investors through the UN-convened Net-Zero Asset Owner Alliance (AOA). They are demonstrating the key role of the insurance industry as risk managers, insurers and investors in supporting the transition to a net-zero economy.

“These seven global insurers and reinsurers represent the ‘G7’ of the insurance industry in terms of net-zero ambition,” said Butch Bacani, who leads the PSI at the UN Environment Programme.

“By advancing the net-zero agenda across both their insurance and investment activities, these insurers are demonstrating cognitive consonance, accelerating the race to zero, and setting the net-zero bar for the rest of the global insurance industry.”

The work of the NZIA is already influencing African insurance entities. Lesley Ndlovu, CEO of African Risk Capacity, which recently produced its first report, said: “Insurance is a cost-effective way of saving lives, protecting livelihoods and securing developmental gains. ARC was set up to move the dial on natural disasters from a reactive to proactive approach. The objectives of the NZIA are at the core of our mandate and we are working through the PSI to encourage the adoption of ESG principles across Africa.”

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