Global insurance industry group ClimateWise, convened by the University of Cambridge Institute for Sustainability Leadership, has released a white paper exploring the potential contribution of innovative insurance products in the transition to a net zero economy.
The report draws on the expertise of more than 10 ClimateWise members including Aon, Allianz, Aviva, AXA, Lloyds, Zurich, and makes recommendations to support the insurance industry’s meaningful part in the decarbonisation of the global economy.
In addition, ‘Product innovation for net zero within the insurance sector’ highlights the need for collaboration both within and beyond the sector, including active engagement with the insurance supply chain and government, in order to create an enabling landscape to drive net zero.
Dominic Christian, Chair of ClimateWise and Global Chairman, Reinsurance Solutions at Aon said: “The tangible impacts of climate change are being felt more deeply and seen more frequently than many expected. Although the insurance industry is changing, that rate of change must accelerate and innovative climate products must be developed so that industry can both enhance resilience and facilitate the transition.
“ClimateWise members seek to be at the forefront of product innovation that drives and enables the transition to net zero and we hope this new white paper will lead the way for greater collaboration within our industry and with external decisionmakers to support the urgent need to tackle climate change.”
Bronwyn Claire, Senior Programme Manager at ClimateWise said: “I’m delighted to see this paper come to life as a result of the ambition and expertise within the ClimateWise membership. Our aim, as ever, is to support the insurance industry as it addresses the opportunities and challenges of global change, and to ensure that the deep expertise held across the insurance value chain can be effectively harnessed to enable the transition. The priority areas identified in this paper, along with the exploration of barriers to innovation, will serve as an excellent springboard from which to advance our collective progress.”
The report was written in collaboration with Deloitte and IcebreakerOne, and builds on previous research by ClimateWise examining policy opportunities to support net zero underwriting.
Gavin Starks, CEO and Founder, Icebreaker One said: “The insurance industry has no choice but to transition to net zero – but it can’t do it alone. To manage climate risks and unlock new commercial opportunities, it needs to find ways to collaborate, and that collaboration should start with making it easier to access and share crucial climate and financial data.
Better access to data could make or break the insurance sector’s response to climate change. It shouldn’t take enormous legal fees, hours of negotiations and expensive closed technical systems to share essential environmental data with insurers. The faster we develop an open standard to make data access easier, the faster the insurance industry can develop the products it needs to thrive in a net zero economy.”