Exclusive insurers seek to relax UN climate alliance rules after members exodus

By Tommy Wilkes

LONDON (Reuters) – The remaining insurers of a United Nations-backed coalition aimed at tackling climate change are set to ease terms for joining the alliance, after a recent exodus of members, according to two people close to the discussions.

The UN-convened Net-Zero Insurance Alliance (NZIA) is set to scrap a six-month deadline for members to publish their greenhouse gas emissions targets, along with other changes aimed at making the membership less prescriptive, the sources said.

The hope is to “stabilize the ship” and create space for ex-members to consider returning later, they said. The NZIA has lost more than half of its members, including AXA, Lloyd’s of London and Tokio Marine, since the attorneys general of 23 Republican-led U.S. states sent a letter on May 15 asking for information on the membership of insurers and threatening legal action.

The AGs said NZIA’s requirements for members to publish and meet greenhouse gas emission reduction targets appeared to violate anti-trust laws, and the alliance’s actions had driven up costs insurance and others for consumers. Launched in 2021 to boost insurers’ efforts to achieve zero carbon emissions on a net basis by 2050 in their underwriting portfolios, the NZIA is one of several industry coalitions under the umbrella group Glasgow Financial Alliance for Net Zero (GFANZ).

The NZIA now has 12 members, down from a peak of 30. Other GFANZ alliances have also come under US political pressure but have not seen many members leave.

CONCERN OVER POTENTIAL RULES CHANGES NZIA’s ‘target setting protocol’ released in January required insurers to publish their initial 2030 emissions reduction targets by the end of July, or within six months of joining for new entrants, then to report on their progress against the objectives annually. But the remaining members, including Britain’s Aviva, Italy’s Generali and South Korea’s Shinhan Life, want to avoid insurers publishing their targets simultaneously, which could lead to further accusations of anti-competitive collaboration, the first source said. , speaking on condition of anonymity due to sensitivity. of the material.

A spokesperson for NZIA declined to comment.

The potential for looser rules has been greeted with concern by environmental campaigners, who say insurers are already doing too little to reduce emissions and that aggressive collective action is needed.

“From the start, NZIA had very minimal membership requirements and expectations,” said Peter Bosshard, Insure our Future Campaign Coordinator.

“Goal setting is the only thing left,” he added. Without these requirements, “NZIA would just become another industry talk shop”.

Other proposals being discussed include transforming the alliance into a broader forum where insurance industry bodies participate in areas such as defining best practices, the first source said.

The changes under discussion have not been finalized, the sources said, and it is unclear how the alliance would deal with insurers who drag their feet on releasing targets.

(Reporting by Tommy Reggiori Wilkes; Editing by Greg Roumeliotis, Simon Jessop and Emelia Sithole-Matarise)

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