Allianz released a new and ambitious policy (1) restricting insurance coverage for the oil and gas sector. The main announcement is the end of all coverage for new oil and gas fields. In doing so, Allianz gave a lesson of leadership to AXA (2) and Zurich who also recently adopted oil and gas policies but blatantly disregarded the conclusion of the International Energy Agency’s (IEA) Net Zero Roadmap about the need to end all fossil fuel supply expansion. Allianz policy is not yet perfect. While Allianz plans to stop the coverage of new oil midstream and downstream projects, its policy fails tackling the risks related to the development of new gas infrastructures. Finally, it seems all efforts have been focused on project underwriting and we can regret the poorness of the measures announced to narrow its exposure to oil and gas companies in its investment portfolio. Allianz must apply the same level of requirement to mind the gap between its oil and gas underwriting exclusion and its investment practices to strengthen its climate leadership.

Key points in the policy

Allianz goes further than AXA and Zurich by stopping the insurance of new upstream oil and gas projects

  • From January 2023, Allianz commits to not issue new single-site and stand-alone Property and Casualty (P&C) insurance coverages (as well as not renew existing contracts as of July 1, 2023). Allianz also commits to not provide new funding for projects in exploration and development of new oil and new gas fields (upstream), for construction of new midstream infrastructure related to oil and for construction of new oil power plants. One major exception could be allowed by Allianz for new oil and gas fields in case of “energy emergency reasons”(3).

  • From January 2025, Allianz will only insure and invest in oil and gas companies which have committed to achieving net-zero greenhouse gas emissions by 2050 in alignment with science-based 1.5°C pathways, across all three greenhouse gas emission scopes. This applies to major oil and gas companies with above 60 million barrels of oil equivalent production in 2020, estimated to represent 85% of the hydrocarbon production of the oil and gas industry combined. Additionally, Allianz stipulates that the companies should ideally align their operations and disclosures with the Climate Action 100+ (CA100+) Net Zero Company Benchmark requirements.

The German insurer also strengthens its policy to restrict its insurance and investments in unconventional oil & gas

  • From January 2023 onwards, Allianz will not issue new single-site and stand-alone P&C insurance coverages (plus not renew existing contracts as of July 1, 2023) and will not provide new funding for both new and existing projects/operations in practices relating to the Arctic (as defined by Arctic Monitoring and Assessment Programme (AMAP), excluding operations in Norwegian territories (4)), the Antarctic, coal-bed methane, extra-heavy oil and oil sands, as well as ultra-deep sea.

  • From January 2025 onwards, Allianz will not provide neither insurance and facultative reinsurance for companies with 10% (20% today) of revenue from oil sands across all Lines of Business (run-off, no new policies) nor insurance and facultative reinsurance for dedicated oil sand projects and new oil sands pipelines (runoff, no new policies).

  • Allianz also excludes companies with more than 10% of their revenues coming from oil sands from its insurance investments with different measures depending on the asset class (5).

Our analysis


Allianz will not insure new oil and gas fields

  • Both new oil and gas fields. While AXA and Zurich, two other big names in the European insurance landscape, only exclude new upstream oil projects, Allianz goes further by excluding both new upstream oil and gas projects from its stand-alone insurance products. Allianz’s policy is now in line with the IEA’s Net Zero by 2050 roadmap (6) in which both new oil and new gas fields should not be approved after 2021.

  • Upstream, midstream and downstream. Allianz will phase down the insurance coverage of new midstream oil projects (pipelines) but also downstream projects (oil power plants), sending a clear message to AXA and Zurich that climate leadership must apply to the entire oil and gas value chain, not only upstream oil activities


Allianz can still insure gas projects

Allianz applies much weaker restrictions on the gas sector. This double standard is unjustified given the scientific consensus on the need to reduce methane emissions and to stop the development of new gas projects.

  • Some potential exceptions for new gas fields? Allianz states in its policy that “in special cases the Group Sustainability Board can decide on exceptions on new upstream gas fields in case a government decides on the development of a new gas field for energy security emergency reasons”, with an annual review of the rule.

  • Allianz could in fact end up insuring new shale gas projects, given the potential exception for new gas projects in case of “energy emergency reasons”. This exception resonates with the current political and energy context following Putin’s war in Ukraine, during which EU governments are looking for alternative sources of gas. However, many analyses have demonstrated that the best solutions to the current crisis lie in energy consumption reduction and the deployment of energy efficiency measures and renewable energies, not in the building of new gas infrastructures. To make sure this exception does not turn into a major loophole, Allianz must commit to publicly publish the number of projects covered thanks to this exception.

  • No exclusions on midstream/downstream gas projects. Although Allianz rules out insurance coverage for midstream and downstream oil projects, the insurer does not apply this same rule to gas. It is a major oversight for Allianz which takes the risk to raise its exposure to stranded assets. The Intergovernmental Panel on Climate Change (IPCC) is clear : “Limiting warming to 2°C or 1.5°C will strand fossil-related assets, including fossil infrastructure and unburned fossil fuel resources” (7).

Allianz can still insure and invest in major oil & gas developers

  • No exclusion for oil and gas developers. While Allianz demonstrates having read and understood the IEA conclusion about the need to stop the development of new oil and gas fields, it fails to apply the rationale to its financial services, underwriting but also investment, to companies. Consequently, Allianz will stop providing coverage for some new projects, but can keep insuring and investing in the companies developing them.

  • Decarbonization targets: too little, too late. While Allianz committed to reduce the Greenhouse Gaz (GHG) emissions of its investment and insurance portfolios by 50% by 2030, Allianz only requires its investees companies and clients to have committed by 2025 to commit “to net-zero GHG by 2050, in alignment with science based 1.5°C pathways, across all three GHG emissions scopes”. Despite the IPCC report warning that emissions must start going down by 2025 at the latest, Allianz still does require investees to adopt short-term and mid-term decarbonization targets. This is a critical loophole: many companies have already pledged to achieve carbon neutrality by 2050, it does not mean their plans are compatible with a 1.5°C carbon budget. For instance, European oil and gas majors have made net zero pledges but will largely exceed their carbon budget. TotalEnergies for instance is deemed “aligned” by Transition Pathway Initiative (TPI) (8), despite the fact that the company plans to increase fossil fuel production, is developing new oil and gas projects, and will overshoot its 1.5°C carbon budget by 2035 at the latest. (9)

Allianz applies low climate standards to its investment practices

  • Allianz fails to adopt any strong criteria to challenge oil and gas companies, as shown above by the lack of requirements on decarbonization targets and oil and gas expansion by companies.

  • Allianz can still invest in oil and gas producers, even in unconventional sectors such as tar sands. Allianz’s new policy takes far too minimal steps to restrict investments in both conventional and unconventional oil and gas companies. In fact, it only restricts investments in tar sands (oil sands) producers, but does not commit to restricting investments in companies with unconventional activities such as Arctic drilling, shale oil and gas or ultradeep offshore. Furthermore, the new corporate restrictions on tar sands will only kick in from 2025 onwards. The 20% threshold that Allianz currently applies does not rule out some of the biggest tar sand producers such as Exxon Mobil, the 4th biggest tar sand producer. (10)

  • Less than 25% of assets under management are covered by the policy. Although Allianz holds a massive €2,5 trillion under management, its exclusion policy only applies to its insurance investments which account for less than a quarter of its total Assets under Management (AuM). (11)

Allianz scores in the Oil & Gas Policy Tracker

This table presents the oil & gaz scores of Allianz based on five criteria of the Oil & Gas Policy Tracker.

We warmly welcome the new Allianz’s oil & gas policy: it sets a very high standard so far for the insurance industry to stop the underwriting of new oil & gas projects. We also call on AXA and Zurich as well as other European insurers – SCOR, Munich Re – lagging further behind, to follow suit. However, Allianz is not yet aligned with what science calls for. Allianz needs to adopt a stronger stance against oil and gas expansion and expansionists by:

1. Committing to end insurance services to new gas projects and strengthening its demands to oil and gas companies.

2. Requiring its clients and investee companies to adopt 1.5°C-compliant decarbonization targets across all scopes by 2025.

3. Ending new investments in companies that do not give up on their oil and gas expansion plans.

4. Adopting an escalation strategy, including a commitment to vote against their management or bogus climate plan, as soon as 2023, and be ready to divest at the latest in 2025.

Here is below the updated scoring grid of our Oil and Gas Policy Tracker regarding Allianz and the other main (re)insurers.

Notes :

  1. Allianz, new oil & gas policy, April 2022
  2. AXA, latest oil & gas policy, October 2021
  3. Read in the Allianz policy : “Exception for new oil & gas upstream projects : “In special cases the Group Sustainability Board can decide on exceptions on new upstream gas fields in case a government decides on the development of a new gas field for energy security emergency reasons. This rule will be reviewed annually
  4. For instance, AXA, Swiss Re or Munich Re define the Arctic exclusion without taking into account Norway
  5. Please refer to the Allianz Oil Sands Business Model document:
    • Public Equity and Public Debt : Maximum 10% from upstream revenue threshold
    • Private Equity and Private Debt – Direct : Total exclusion of upstream oil sand companies but a maximum 10% of directly connected midstream
    • Private Equity and Private Debt – Funds : No companies with more than 10% of revenue from oil sands (upstream or directly connected midstream) in funds and a maximum of 10% of companies in funds to have any oil sands revenue
  6. IEA, Net Zero by 2050 roadmap, 2021
  7. IPCC, 6th Assessment Report, 4th of April 2022
  8. See here further analysis on TPI’s methodology
  9. Reclaim Finance, IS TOTALENERGIES ON TRACK FOR 1.5°C?, March 2022
  10. According to the Global Oil and Gas Exit List, a database developed by the NGO Urgewald, the 10 biggest tar sands producers in 2021 were : Canadian Natural Resources Ltd, Suncor Energy Inc, Cenovus Energy Inc, Exxon Mobil, Husky Energy, Imperial Oil Ltd, MEG Energy Corp, TotalEnergies, PISC Tatneft, CNOOC Ltd
  11. Data from the latest Allianz Annual Report : 643 €billion out of 2609 €billion