A range of international NGOs supporting Unfriend Coal have asked global insurers to champion a green and fair recovery from the COVID-19 crisis, stating that as professional risk managers they should have a unique understanding of global threats.

In a letter to industry associations, the signatories accuse the sector of being “fully aware” of the risks of a global pandemic for many years but of failing to do enough to ensure governments prepared effectively, and warn it not to make the same mistake again now that insurers recognise the climate emergency is the world’s greatest threat.

The letter, signed by 25 NGOs in 11 countries calls on insurers to address the COVID-19 and climate crises together by working to ensure economic stimulus programmes are consistent with limiting climate change to 1.5C.

“International insurance associations and many of their member bodies have made numerous public commitments about the need for rapid climate action. If you are serious about these commitments you now need to speak out, vigorously and publicly, at the international and national level for green and fair recovery programmes which are consistent with the IPCC’s 1.5C pathways,” it says.

“In addition, the insurance industry has to get its own house in order with regard to the climate crisis. Insurance associations should encourage their member companies to divest from fossil fuel companies, to end cover for coal projects, coal companies and for oil and gas expansion projects, and to commit to phasing out cover for oil and gas companies in line with a 1.5C pathway.”

The call was welcomed by Günther Thallinger, CIO of Allianz and chair of the Net-Zero Asset Owner Alliance, whose 22 members include insurers Aviva, AXA, Generali, Munich Re, Swiss Re and Zurich.

“Tomorrow’s recovery plans can and must lay the foundations for an irreversible shift to a resilient, net-zero and inclusive economy. The Alliance stands ready to work with governments, international agencies and other stakeholders to realise this goal,” he said.

However, Deborah Ritchie, editor of leading Insurance publication CIR Magazine questioned the wisdom of combining issues, saying: "It is not useful to anyone to compare the pandemic to climate change as a risk. They are two very separate risks, with completely different dynamics, costs and effects. I don't think it is helpful to talk about the two in the same breath."

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