International insurance regulators establish forum to address sustainability issues
The insurance sector is pivotal to an effective response to sustainable development including providing coverage against natural disasters.
San Francisco, 5 December - A new international network of insurance regulators and supervisors has been launched to promote cooperation on critical sustainable insurance challenges, such as climate change.
Held in San Francisco, the first meeting of the Sustainable Insurance Forum included insurance supervisors and regulators from Brazil, California, France, Ghana, Jamaica, Morocco, the Netherlands, Singapore and the UK, as well as the International Association of Insurance Supervisors.
The insurance sector is pivotal to an effective response to sustainable development. This includes providing coverage against natural disasters as well as integrating environmental, social and governance (ESG) factors into the management of their assets.
Increasingly, insurance regulators and supervisors are exploring how these factors impact upon their goals of ensuring the safety, soundness and accountability of the sector. For the first time, the Forum provides an international platform for insurance regulatory and supervisory bodies to share experience and explore common approaches.
The California Department of Insurance and UN Environment co-hosted the inaugural meeting of the Forum.
California's Insurance Commissioner Dave Jones said: "Insurance regulators have an important role to ensure that critical sustainability risks and opportunities are effectively managed. The new Forum will enable supervisors to learn from each other and take common action against shared threats to the insurance sector such as climate change."
UN Environment's Assistant Secretary General Elliott Harris said: "Insurance is one of the pivotal sectors underpinning the transition to sustainable development. As part of this, regulators and supervisors will play a vital role and UN Environment is delighted to be the secretariat for the new Forum."
Natalie Haanwinckel Hurtado, Secretary General of Brazil's SUSEP said: "SUSEP welcomes the launch of the Sustainable Insurance Forum as a way for us to both learn from the experience of others and share Brazil's lessons with our peers in other countries."
Commissioner Lydia Bawa of the National Insurance Commission of Ghana said: "In providing a space for supervisors and regulators to convene and collaborate, the Sustainable Insurance Forum can inspire other jurisdictions to tackle critical sustainability issues."
David Rule, Executive Director of Insurance Supervision at the UK's Prudential Regulatory Authority said: "The potential for an international network to share experience among regulators was highlighted in our landmark review of the insurance sector and climate change. We are delighted that this seed of an idea has now come to fruition".
Yoshiro Kawai, Secretary General of the International Association of Insurance Supervisors, said: ""As IAIS' Secretary General, I welcome the establishment of the Forum as a platform for insurance supervisors to discuss how they can support the development of an insurance industry that contributes to environmental, social and economic sustainability."
The Forum builds on UN Environment's long-standing work on sustainable insurance - and UN Environment will provide the Forum's secretariat. UN Environment is home for the Principles for Sustainable Insurance, which provides a structured framework for insurance companies to integrate ESG factors into their operations.
In addition, UN Environment's Financial Inquiry has explored how the rules that govern the financial system, including the insurance sector, can best promote long-term sustainable development. A leadership group of eight jurisdictions - including Brazil, France, the Netherlands, the Philippines, South Africa, the UK and the US States of California and Washington - has guided the design of the Forum.
The San Francisco meeting approved the Forum's first year work programme for 2017, including a focus on disclosure, access to insurance, sustainable insurance roadmaps, climate risk, disaster risk reduction and capacity building for supervisors.
Nick Robins, co-director of the Inquiry added: "The launch of the Sustainable Insurance Forum highlights the leadership that exists across the world among a growing number of insurance supervisors. Its work programme aims to make a real difference in the way that insurance supervisors respond to the world's sustainability challenges."
The Forum's inaugural meeting also benefitted from presentations from the insurance sector and sustainability experts including from Aon, Bahamas First General Insurance, CERES, DLA Piper, Insurance Association of the Caribbean, Mercer, S&P, SwissRe and the 2Degrees Initiative.
Notes for Editors
The California Department of Insurance:
As regulator of the largest insurance market in the United States, Insurance Commissioner Dave Jones leads a national, multi-state insurance regulators group that surveys annually more than 1,000 companies regarding their response to climate risk, capturing approximately 77 percent of the entire U.S. insurance market. In January 2016 Jones launched the Climate Risk Carbon Initiative to enable the industry, regulators, consumers and investors to assess climate risks posed for insurers' investments in fossil fuel holdings and thermal coal enterprises. The data received will be used to better inform regulators, interested members of the public, and the insurance companies themselves on the extent to which they hold carbon investments facing potential climate risk. The information will also enhance regulators' future in-depth financial analysis and financial examinations of insurers with regard to climate risk. More information on the Climate Risk Carbon Initiative.
UN Environment's Principles for Sustainable Insurance:
The Principles for Sustainable Insurance (PSI) serve as a global framework for the insurance industry to address environmental, social and governance risks and opportunities, and to strengthen its contribution to building resilient, inclusive and sustainable communities and economies. Endorsed by the UN Secretary-General and insurance CEOs, the PSI was launched at the 2012 UN Conference on Sustainable Development and is the largest collaborative initiative between the UN and the insurance industry. Nearly 100 organisations worldwide have adopted the PSI, including insurers representing more than 20% of world premium volume and US$14 trillion in assets under management. More information on the PSI is at: www.unepfi.org/psi or from: firstname.lastname@example.org.
UN Environment's Inquiry into the Design of a Sustainable Financial System:
The Inquiry into the Design of a Sustainable Financial System has been initiated by UN Environment to advance policy options to improve the financial system's effectiveness in mobilizing capital towards a green and inclusive economy - in other words, sustainable development. Established in January 2014, it published the first edition of 'The Financial System We Need' in October 2015, and the second edition 'From Momentum to Transformation' in October 2016. The Inquiry's mandate currently extends to the end of 2017, with work focused on deepening and taking forward its findings.