Within the alliance of climate insurers, cascading defections

Three founding members of the global alliance of insurers for the objective of zero carbon (NZIA), the reinsurer Scor and the giants Axa and Allianz, announced this Thursday, May 25, their departure, while the pressure from the United States has increased.

Among the three groups to have announced their departure, the first French insurer Axa. AFP/File

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AXA "will continue its individual journey in terms of sustainable development, as an insurer, investor and responsible company," said the first French insurer in a statement, while Allianz said it was keeping its climate objectives "unchanged".

Earlier in the day, Thierry Léger, CEO of Scor since May 1st, also announced the departure of the alliance before the shareholders gathered at a general meeting. "Today we have decided to leave the NZIA. This does not change our commitments, nor our roadmap" in the fight against global warming, he said.

Legal risk

Scor is the first French to slam the door of the alliance, created in July 2021 and placed under the aegis of the UN, and the second these days after Swiss Re. Three other European heavyweights had preceded them in recent months by announcing their departure: Munich Re, Hannover Re and the insurer Zurich. In the wake of these new defections, the French Matmut also announced his departure.

None of them detailed the reasons for his departure, but at the end of March, Munich Re had mentioned the risks of hindering free competition inherent in this type of alliance. "Each company is free to join or withdraw from the NZIA at any time and for any reason," the NZIA said Wednesday in a statement acknowledging the departure of some of its members, "especially those with significant activity and exposure in the United States."

A week ago, about twenty US Republican state prosecutors sent a letter of criticism to the alliance, accusing them of violating US competition laws, defending militant positions on climate and contributing to inflation. For the largest members, present in the United States, remaining in the alliance therefore implies a legal risk, with years of proceedings.

Maintenance of commitments

With about thirty members until recently, NZIA was founded by Axa, Allianz, Aviva, Generali, Scor, Swiss Re and Zurich Insurance Group. Its members, including France's Matmut and Crédit Agricole Assurances, have agreed to set criteria for the acceptability of the highest-emitting industries in their client portfolios in line with the objective of carbon neutrality by 2050.

However, the resigning members of the alliance insisted on the continuity of their commitments to the climate. Scor executives recalled at the general meeting the importance of the measures they had taken in the past to fight against global warming, some of which were reinforced on Thursday. "If development is not sustainable (...) insurance prices will increase, the ability to pay premiums will decrease and in some areas there will be no more insurance," warned the emblematic president of the group Denis Kessler.

More concretely, Thierry Léger evoked "new exclusions on oil, gas, particularly in the Arctic, on the tar sands and on thermal coal", implemented as of September 1, 2023. For example, Scor is extending its exclusion commitment to new gas fields after taking a similar decision last year on oil projects. Exceptions may be granted if the client presents a "verified strategy aligned with a credible Net Zero transition plan," the reinsurer said.

(

With AFP)

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