A number of examples show how insurers are gradually making sustainability a firm component of their business models. This list is by no means exhaustive. The survey participants are involved in numerous other specific activities.
For further information on these activities, please refer to the annual or sustainability reports of the individual companies concerned. Some members already publish public climate-related risk reports (TCFD Report, Task Force on Climate-related Financial Disclosures).
Reduction of CO2 emissions
Since 2018, Swiss Re has no longer offered insurance cover for companies and projects that rely on thermal coal for more than 30 percent of their energy needs. The insurer Zurich also made the decision last year to stop offering insurance to companies that generate more than 30 per cent of their income from thermal coal or use coal to generate more than 30 per cent of their electricity. Existing customers that do not meet these criteria will be helped to reduce their reliance on fossil fuels. AXA decided in 2019 to tighten up its investment criteria in the coal business even further. It aims to have withdrawn from the coal business in all OECD countries by 2030, and from the coal business in the rest of the world by 2040. Swiss Life has defined internal requirements regarding the coal industry in its proprietary investments. These requirements prohibit Swiss Life from making new investments in bonds issued by companies that generate more than 10 per cent of their income from the mining and sale of thermal coal.
In its Responsible Investment Policy, Baloise has stipulated that throughout its entire insurance portfolio, investment must not be made in any issuer that generates more than 30 per cent of its revenue from coal. This applies to all new funds, and the company’s existing portfolios have also been adjusted accordingly.
Supporting renewable energy
In order to safeguard the generation of electricity using solar energy, a process that depends on weather conditions, making it subject to considerable fluctuations, Swiss Re has offered solar companies an insurance product that covers production losses of up to 95 per cent of a pre-defined annual production volume since 2018. This reduces the production risk involved and makes it cheaper to finance the facility.
Real estate investments
Swiss Life and AXA have incorporated ESG criteria into the entire lifecycle and value creation process of their real estate investments. Swiss Life has developed its own sustainability framework for this purpose. AXA is committed to systematically reducing and decarbonising the environmental footprint of its properties in order to comply with the federal government’s energy strategy and the objectives set out in the Paris Agreement 2015. Sustainable seals of quality, such as Minergie, DGNB, LEED, BREEAM and HQE, allow verification of compliance with the defined sustainability criteria by external experts. Allianz Suisse also takes stringent sustainability criteria into account in its acquisitions and attaches considerable importance to compliance with the Paris climate goals, particularly during the renovation phase. Allianz Suisse renovates its investment properties exclusively using CO2-free technology and models a decarbonisation path that complies with the SIA 2040 requirements for all its buildings. This approach is being adopted by Allianz Suisse to ensure that its building stock of about 300 properties will be net zero-compliant by 2050.
At the insurer Vaudoise, the incorporation of environmental, social and good governance criteria is a key element in the management of its real estate portfolio in particular, the aim being to reduce the ecological footprint. This focus is reflected in particular in work commissioned to improve the building envelope and heat production, and to optimise building use.
Microinsurance for greater social sustainability
Microinsurance offers affordable insurance protection to low-income sections of the population in the world’s developing regions. Zurich Versicherung and Swiss Re are involved in such initiatives through joint ventures, such as Blue Marble Microinsurance and Hemayet Lead. In 2016, Blue Marble Microinsurance offered small-scale farmers in Zimbabwe insurance cover for extreme weather conditions in order to improve their financial stability. A similar project was launched in Colombia in 2018. In Egypt, poorer female market vendors were given access to healthcare and cover for natural hazards.
A lab for natural hazards
Initiatives such as the 'Mobiliar Lab for Natural Risks' help to drive research on climate risks and natural hazards in order to foster a better understanding and allow preventative measures to be taken. The Mobiliar Lab for Natural Risks is a joint research initiative of the Oeschger Centre for Climate Change Research at the University of Bern and the insurer Mobiliar. The main research areas are floods, storms and hail, and the modelling of the resulting damage.