ShareAction’s latest data revealed that insurance companies are failing to use their influence to fight climate change. In response to this and in recognition of World Environment Day this June, Insurance Times asks insurance businesses what action they are taking to reduce damage to the planet
Carolyn Rich, head of social responsibility, Allianz Insurance
“We’re committed to limiting global warming to 1.5°C and to drive this transition, we’ve set ambitious climate and environmental targets for ourselves as an investor, an insurer and a company.
”Globally, we don’t invest in coal-based business models and we’ll totally stop insuring them by 2040 or sooner.
“We’re investing in renewable energy schemes and infrastructure, including 90 wind farms and nine solar farms, as well as green buildings and bonds that support the transition to a low carbon economy.
”We also offer insurance products which support our plans to limit global warming, including cover for renewable power installations.
“We look at how we operate as a company to minimise our environmental impact. We have been carbon neutral since 2012 and will source all our electricity from renewable sources by 2023.
“Finally, we aim to minimise waste and use more recycled parts in our claims process. In motor, our automated system makes it easier for repairers to source recycled car parts. And in property, our repair-not-replace strategy is saving tonnes of material from landfill.
”Sustainable claims are the way forward. In that area, as in others, we are constantly innovating and we hope these solutions soon become the norm across the industry.”
Greg Laker, director of operations, QuestGates
“QuestGates had already made significant headway on a number of green objectives that we set ourselves a couple of years ago, focused on scope one and scope two carbon emissions.
“Scope one emissions refer to direct emissions from owned or controlled sources, while scope two emissions are indirect emissions from the generation of purchased energy.
“The working from home environment brought about by the Covid-19 pandemic gave us the opportunity to take a harder look at how we could implement a more rigorous set of targets. At the beginning of this year, we made a commitment to be a carbon neutral company by 2027.
“There are a lot of relatively simple and straightforward steps that we are taking. For example, deploying our proprietary QUBExpert secure video technology across all areas of the business to reduce the need for site visits or follow-ups to view additional damage and agree variation orders on larger building claims. We reduced mileage by 55% last year, which equates to around 104 tons of CO2.
“Digital initiatives such as these are really important, but what really excites me and where I see huge leaps being made is through engagement with suppliers to develop new techniques when reinstating properties following flood and fire, as well as liaison with clients to advise on risk management improvements to reduce the extent of future claims and ultimately reduce landfill waste.”
Daniel Innes, director, Clear Group
”In doing so, Clear Group is the first insurance broker to set this commitment through the Science Based Targets Initiative, which aims to enable companies to set emission reduction targets in line with leading climate science.
“Over the past 12 months, the team at Clear has been collecting and analysing data on our environmental impact to uncover our carbon footprint as a business.
”We are now upgrading our IT suite, which will allow the business to reduce the number of IT facilities required. This action fulfils one of the key carbon net zero initiatives and will help reduce power consumption across the business.
“Clear is determined to address how to make business journeys more environmentally sustainable in the future. Staff now keep a more detailed record of their business mileage and flights, as this information will be essential for Clear in reporting our carbon emissions accurately each year.
“To make a positive impact straightaway, Clear has become carbon neutral through the purchase of carbon credits. Carbon credits, or offsets, help finance clean energy projects in emerging countries through profit for purpose company Climatecare, which helps organisations take responsibility for their climate impact by financing, developing and managing carbon reduction projects across the world.”
Denise Eastlake, head of climate change desk, DAC Beachcroft
“DAC Beachcroft is a key supplier to the global insurance market and from our perspective, insurers are doing a lot.
”ClimateWise, convened by The University of Cambridge Institute for Sustainability Leadership, is a global insurance industry collaboration with over 35 members that is focused on driving action on climate change risk.
”Seven global (re)insurers have established the Net-Zero Insurance Alliance, under the auspices of the UN Principles for Sustainable Insurance, to accelerate the transition to a net zero economy. They are also members of the Net-Zero Asset Owner Alliance, which is committed to a net zero investment portfolio by 2050.
“Insurers are looking carefully at their underwriting and investment decisions and have given senior managers responsibility to drive forward sustainability measures within their own organisations.
”For example, Aviva has announced that all its offices will be powered by renewable energy by 2030 and Zurich is committed to a reforestation programme, as well as reducing the exposure of vulnerable communities to flooding through its Z Zurich Foundation.
”On the whole, the market is fully aware of the advantages and opportunities that will come from a smooth transition to a low carbon economy and is committed to playing its part.”
Frank Streidl, head of energy, marine and construction, Zurich
“Our role as an insurer is to protect people from risks and climate change is one of the biggest global threats there is.
”To speed up the transition to a net zero emission economy, the insurance industry should be using multiple levers, including investments, operations, products and services.
”Zurich’s own operations have been carbon neutral since 2014 and in 2019, we became the first insurer to sign up to the UN Business Ambition Pledge to limit average global temperature increases to 1.5°C.
“Working with others is where insurers can make the biggest impact on climate change and Zurich is using its influence as a global insurer to drive cuts in CO2 emissions.
”From an underwriting perspective, we are partnering with our customers to help them make the transition. For the most carbon intensive industries, we are engaging with them to assess their carbon footprint and encourage improvements.
“Investments are another area where insurers can drive meaningful change. In 2020, Zurich’s impact investing portfolio helped avoid a total of 2.9 million tons of CO2-equivalent emissions - the same as carbon sequestered by 48 million tree seedlings grown over a decade.”
Rowan Douglas, head of the climate and resilience hub, Willis Towers Watson
“Future climate risks are unprecedented and systemic - the magnitude of the challenge is so huge that every lever is being explored to turn economies to meet the Paris targets.
“While the financial sector is well placed to take a lead, climate-related risk not only needs to be integrated into day-to-day risk management, but also to steer the whole economic transition to a low carbon and resilient future.
“We are seeing an evolution in what net zero finance means for the financial sector and its stewardship role in a whole economy transition towards a climate resilient future.
“Meanwhile, pressure from ambitious new climate targets and scrutiny from central banks, regulators, investors and the wider public continues to increase.
To continue to thrive, financial institutions will need to adapt and align their portfolios with a net zero carbon world.”
Jane Pocock, managing director, Copart UK and Ireland
“Sustainability and recycling are at the top of everyone’s agenda and all businesses have become more conscious about operating in a more environmentally friendly way that is less damaging to the planet.
“We work with most of the UK’s major insurers and I’ve seen a concerted effort across the industry to become more environmentally responsible and adopt greener working practices, including the recent launch of LV=’s Green Heart Standard.
“It’s important that we all share the same ethos and values, so we can collectively drive positive change across the insurance industry - our own Copart Cares campaign focuses on caring for the environment, our customers and our teammates, in everything that we do.
“It’s vital that we all work together to promote sustainability, achieve carbon neutrality and identify greener solutions, such as the increased use of recycled parts.
”As the main facilitator in this space, Copart has supported the green parts industry for many years and are the biggest supplier of vehicles that are broken for parts, assisted by our U-Pull-It and Breaker Bid 4 U services.
“We’ll keep conversations going with our insurance partners, so we can continue adapting our services to meet growing interest in green parts and recycling initiatives and support the bigger picture of sustainability within our industry.”