The Net Zero Insurance Alliance (NZIA) is to target brokers and other supporting industry institutions as it looks to add to its membership following its formal launch at the COP26 talks in Glasgow.
Butch Bacani, who leads the UN Environment’s Principles for Sustainable Insurance Initiative (PSI), which established the NZIA earlier this year, said one of the key priorities for the alliance was to broaden its reach across the sector.
“We want to expand our base of insurers and reinsurers worldwide and would like to get brokers as part of the NZIA. We also want to get supporting institutions like insurance associations to be part of the alliance,” he said.
The NZIA is currently working with the Partnership for Carbon Accounting Financials on establishing a methodology to better measure carbon footprints of member portfolios.
“We are working on a standard to disclose global emissions by the summer of next year, and our target setting protocol should be able to launch by January 2023. Once that is out our members should be able to publish their first interim targets within six months,” Bacani revealed.
While the NZIA’s first eight members were all based in Europe, the alliance has since added American Hellenic Hull, Icea Lion Group (its first African member), NN Group and Shinhan Life (the first Asian member).
Lloyd’s became the alliance’s latest member shortly before COP26 talks began. Lloyd’s membership of the NZIA commits the Corporation to transition its “operational and attributable” greenhouse gas emissions to net zero by 2050, as well as assets held by the Central Fund.
As part of the commitment Lloyd’s said it will also “advocate and support all market participants to introduce and implement their own net zero plans in order to reach a net zero underwriting position for the market by 2050 at the latest”.
Serving as an enabler
Members of the NZIA set out their aspirations for the industry coalition today during a UNEP briefing as part of the COP26 talks.
Renaud Guidée, group chief risk officer at Axa, which chairs the NZIA, said it was important private companies took the opportunity of COP26 to develop greater cooperation, as governments did at COP21 in Paris, but acknowledged the industry will need support from governments and other stakeholders on the journey towards net zero.
Guidée said it was critical that the industry “walked with our clients to help them transform”.
“It’s not about being an exclusion machine. It’s very important we roll up our sleeves to help the economy transition.”
Thierry Léger, group chief underwriting officer at Swiss Re, said the cost to the global economy of the transition between now and 2050 will be more than $100trn, with trillions more needing to be spent on carbon renewal in the 50 years that follow.
“This is an opportunity, not a threat,” he said. “For insurers, it is about enabling the transition, not running away.”
Stefan Golling, member of the board of management at Munich Re, said the industry has to play an important role in supporting the transition.
“The insurance industry has always been the enabler of new technology. By taking on the risk we can enable new technologies to be adopted widely.”