{"id":9618,"date":"2021-03-16T10:58:02","date_gmt":"2021-03-16T09:58:02","guid":{"rendered":"https:\/\/reclaimfinance.org\/site\/?p=9618"},"modified":"2023-02-28T16:52:10","modified_gmt":"2023-02-28T15:52:10","slug":"swiss-re-becomes-the-first-reinsurer-to-announce-a-total-exit-from-coal","status":"publish","type":"post","link":"https:\/\/reclaimfinance.org\/site\/en\/2021\/03\/16\/swiss-re-becomes-the-first-reinsurer-to-announce-a-total-exit-from-coal\/","title":{"rendered":"Swiss RE becomes the first reinsurer to announce a total exit from coal"},"content":{"rendered":"

Press release – Reclaim Finance <\/b><\/span><\/strong><\/p>\n

March 16, 2021 – Today, Swiss Re announced new climate targets. Among them is a commitment to <\/span><\/span>completely eliminate<\/span><\/span> thermal coal from its insurance portfolios, and particularly from complex <\/span><\/span>re<\/span><\/span>insurance treaties, by 2030 (OECD) and 2040 (rest of world). If implemented correctly, this policy change marks a breakthrough in the insurance industry <\/span><\/span>– <\/span><\/span>Reclaim Finance calls on SCOR to follow suit.<\/span><\/span> <\/span><\/span><\/b><\/span><\/p>\n

More <\/span>than<\/span> 20 <\/span>insurers<\/span> and <\/span>reinsurers<\/span> have <\/span>adopted<\/span> coal<\/span> policies<\/span>, but <\/span>only<\/span> AXA has <\/span>announced<\/span> a <\/span>robust<\/span> coal<\/span> exit <\/span>policy<\/span> aligned<\/span> with<\/span> a 1.5\u00b0C <\/span>target<\/span> – <\/span>according<\/span> to the Coal Policy Tool, <\/span>which<\/span> assesses<\/span> and compares <\/span>all <\/span>policies<\/span> adopted<\/span> by <\/span>financial<\/span> actors<\/span> on <\/span>coal<\/span>. <\/span>Of the four major global <\/span><\/b>reinsurers<\/span><\/b> <\/b>with<\/span><\/b> a <\/span><\/b>coal<\/span><\/b> <\/b>policy<\/span><\/b>, <\/span><\/b>Swiss<\/span><\/b> Re, Munich Re, <\/span><\/b>Hannover<\/span><\/b> Re and SCOR, <\/span><\/b>only<\/span><\/b> <\/b>Swiss<\/span><\/b> Re has committed to apply its <\/span><\/b> <\/b>policy<\/span><\/b> to <\/span><\/b>reinsurance<\/span><\/b> <\/b>treaties<\/span><\/b> <\/b>from<\/span><\/b> 2023. <\/span><\/b>The latter <\/span>constitute<\/span> a major part of <\/span>reinsurance<\/span> contracts<\/span> but are complex contracts that<\/span> cover all the <\/span>risks<\/span> of a certain type of client <\/span>with<\/span> diverse profiles or <\/span>activities<\/span>. <\/span>The <\/span><\/b>other<\/span><\/b> <\/b>policies<\/span><\/b>, <\/span><\/b>including<\/span><\/b> <\/b>that<\/span><\/b> of SCOR, only apply to <\/span><\/b>reinsurance<\/span><\/b> for facultative cover<\/span><\/b>age<\/span><\/b>, <\/span><\/b>which<\/span><\/b> <\/b>only<\/span><\/b> <\/b>covers<\/span><\/b> a <\/span><\/b>specific<\/span><\/b> <\/b>risk<\/span><\/b>. <\/span><\/b><\/p>\n

Today<\/span>, <\/span>Swiss<\/span> Re <\/span>announced<\/span> that<\/span> in 2023, <\/span>it<\/span> will<\/span> introduce<\/span> new <\/span>exposure<\/span> thresholds<\/span> on thermal <\/span>coal<\/span> for <\/span>reinsurance<\/span> treaties<\/span> in <\/span>its<\/span> property<\/span>, engineering, <\/span>casualty<\/span>, <\/span>credit<\/span> and <\/span>surety<\/span>, and marine cargo <\/span>lines<\/span> of business, and that it will gradually lower these thresholds until they are <\/span>completely<\/span> eliminated<\/span> (1). <\/span>However<\/span>, no <\/span>thresholds<\/span> are <\/span>specified<\/span> at <\/span>this<\/span> time.<\/span><\/p>\n

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\u00ab\u00a0<\/span><\/span>Swiss<\/span> Re <\/span><\/span>confirms<\/span><\/span> its<\/span><\/span> ambition to <\/span><\/span>apply<\/span><\/span> its<\/span><\/span> coal<\/span><\/span> policy<\/span><\/span> to <\/span><\/span>reinsurance<\/span><\/span> treaties<\/span><\/span> and <\/span><\/span>clearly<\/span><\/span> leads the <\/span><\/span>way<\/span><\/span> by setting full exit targets <\/span><\/span> in line <\/span><\/span>with<\/span><\/span> Paris. <\/span><\/span>We<\/span><\/span> welcome<\/span><\/span> this<\/span><\/span> announcement<\/span><\/span> and call on <\/span><\/span>other<\/span><\/span> reinsurers<\/span><\/span>, <\/span><\/span>starting<\/span><\/span> with<\/span><\/span> the French company SCOR<\/span><\/span>, to follow <\/span><\/span>this<\/span><\/span> example<\/span><\/span>. The <\/span><\/span>climate<\/span><\/span> emergency <\/span><\/span>is<\/span><\/span> here<\/span><\/span> and <\/span><\/span>it<\/span><\/span> is<\/span><\/span> no longer acceptable to <\/span><\/span>see<\/span><\/span> reinsurers<\/span><\/span>, the ultimate risk <\/span><\/span> managers <\/span><\/span><\/span><\/span><\/span>in our societies, shirk their responsibilities and hide behind<\/span> the <\/span><\/span>complexity<\/span><\/span> of <\/span><\/span>reinsurance<\/span><\/span> treaties<\/span><\/span> to continue to support the <\/span><\/span>coal<\/span><\/span> industry<\/span><\/span>\u00a0\u00bb <\/span><\/span>comments<\/span><\/span> Lucie Pinson, <\/span><\/span>founder<\/span><\/span> and <\/span><\/span>director<\/span><\/span> of Reclaim Finance. <\/span><\/span><\/p>\n<\/blockquote>\n

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\u00ab\u00a0<\/span><\/span>We regret, however, the lack of detail on the criteria that will be applied, given that it has been more than two years since Swiss Re announced its ambition to apply its coal policy to reinsurance treaties. There can be no exit from coal without a halt to its expansion and we call on Swiss Re to immediately commit to excluding developers of new coal projects as soon as its policy is applied to reinsurance treaties. Failing that, we call on Swiss Re, SCOR and other reinsurers to stop signing reinsurance contracts with insurers that continue to cover the risks associated with the construction of new coal plants, mines and infrastructure<\/span><\/span>,\u00a0\u00bb continues Lucie Pinson.<\/span><\/span> <\/span><\/span><\/span><\/p>\n<\/blockquote>\n

In <\/span><\/span>early<\/span><\/span> March, the <\/span><\/span>Insure<\/span><\/span> Our Future network <\/span><\/span>wrote<\/span><\/span> to <\/span><\/span>ten<\/span><\/span> of the <\/span><\/span>world’s<\/span><\/span> largest<\/span><\/span> reinsurance<\/span><\/span> companies<\/span><\/span>, <\/span><\/span>including<\/span><\/span> Munich Re, Hannover Re<\/span><\/span>, SCOR, Berkshire Hathaway, Lloyd’s of London, MAPFRE and Vienna Insurance Group, asking them to take steps to exclude coal from their treaties (2)<\/span><\/span>. <\/span><\/span> <\/span><\/span><\/p>\n

Swiss<\/span><\/b> Re has <\/span><\/b>also<\/span><\/b> <\/b>announced<\/span><\/b> a 35% <\/span><\/b>reduction<\/span><\/b> in the <\/span><\/b>carbon<\/span><\/b> <\/b>intensity<\/span><\/b> of <\/span><\/b>its<\/span><\/b> <\/b>investment<\/span><\/b> portfolio <\/span><\/b>from<\/span><\/b> <\/b>its<\/span><\/b> 2018 <\/span><\/b>level<\/span><\/b> by 2025. <\/span><\/b><\/p>\n