Moody’s teams up with specialty reinsurer on new ESG underwriting solution

Global risk assessment firm Moody’s has today launched a new environmental, social and governance (ESG) insurance underwriting solution for property and casualty (P&C) insurers.

The solution was created in collaboration with global specialty (re)insurer Chaucer Group and Moody’s analytics company RMS, with the aim of enabling customers to integrate ESG into commercial underwriting and portfolio management activities.

It combines data on public and private companies with an ESG assessment framework to generate ESG indicators and scores, which allow insurers to build their own view of ESG risk as well as monitor performance and trends.

The ESG insights can then be used when making business decisions – including identifying relationships between ESG factors and financial risk metrics, such as claims frequency and loss ratios.

Colin Holmes, general manager of insurance at Moody’s Analytics, said: “As insurers are seeking to measure the ESG impact of their portfolio – alongside the assessment of traditional insurance risks – this new offering is a great example of how our integrated risk-assessment strategy helps meet our customers’ needs.”

Driving results

Chaucer Group chief executive John Fowle added: “Over the last 12 months we have collaborated with Moody’s to support them in the development of Moody’s ESG insurance underwriting solution by providing expertise in underwriting and risk management.

“The (re)insurance industry has a pivotal role to play in helping corporates make the transition to become more sustainable.

“This isn’t going to happen overnight but by helping clients identify areas that are in need of improvement, we can help them implement incremental changes that will pay dividends in the long-term.”

Moody’s completed the acquisition of RMS in September 2021.

Alongside Moody’s ESG insurance underwriting solution, its climate risk solutions for insurers include the Moody’s Analytics Climate Pathway Scenario Service and the RMS Climate Change Models for climate risk analytics.