By Simon Jessop and Carolyn Cohn
LONDON – Europe’s largest insurer Allianz plans to take a tougher line on insuring the oil and fuel business as a part of efforts to align its underwriting insurance policies with the world’s local weather objective, the corporate stated on Friday.
The transfer is the most recent by a serious insurer to curtail insurance coverage to the power sector, a number one driver of greenhouse fuel emissions, and comes as scientists warn of a quickly closing window to restrict the worst results of world warming.
It follows a report from the Worldwide Power Company final yr which stated no extra funding was wanted in new oil and fuel fields if the goal was to be met.
With strain rising to speed up company efforts to rein in emissions, Allianz stated from the beginning of 2023, it could now not challenge new property and casualty insurance coverage to fund new oil and fuel tasks, and cease renewing current contracts from July 2023.
The brand new exclusions would cowl exploration and growth of recent oil and fuel fields; building of recent mid-stream oil infrastructure; building of recent oil energy vegetation; and people linked to tasks within the Arctic, Antarctic or coal-bed methane, extra-heavy oil and oil sands, in addition to ultra-deep sea fields.
“With these new tips, Allianz is strengthening its promise to contribute to an orderly decarbonisation of the economic system,” stated Allianz board member Günther Thallinger.
As of January 2025, Allianz stated it could solely insure oil and fuel firms which have been on a science-based pathway to net-zero emissions by 2050, together with the foremost oil firms liable for the lion’s share of emissions.
Beginning on the similar time, Allianz additionally stated it could present no insurance coverage, facultative reinsurance, or reinsurance for a single threat or outlined package deal of dangers, or funding to firms which get greater than 10% of their income from oil sands, after beforehand setting the brink at 20%.
NGO Insure our Future stated it welcomed the transfer by Allianz, “which raises the bar for the insurance coverage business” and referred to as on others within the sector to observe go well with.
Allianz is the tenth main insurance coverage firm to undertake oil and fuel restrictions, it stated, and there was “actual momentum now for all insurance coverage firms to undertake oil and fuel insurance policies that align with the local weather science.”
Amongst others to have tightened their insurance policies in latest months are Swiss Re, the world’s second-biggest reinsurer, which stated it March it could now not insure most new oil and fuel tasks.
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