US-based Chubb announced on Monday it will no longer provide insurance for companies earning more than 30% of their revenue from coal, making it one of the first major underwriters in the country to set such a precedent.
Under heightening pressure from various environmental groups, the company now joins a growing movement to boycott coal-based firms from receiving insurance that has up until this point remained distinctly European.
“Chubb recognizes the reality of climate change and the substantial impact of human activity on our planet,” said chairman and CEO Evan Greenberg.
“Making the transition to a low-carbon economy involves planning and action by policymakers, investors, businesses and citizens alike.
“The policy we are implementing today reflects Chubb’s commitment to do our part as a steward of the Earth.”
Chubb’s new coal insurance policy
Chubb’s new policy also means it will no longer underwrite risks related to the construction and operation of new coal-fired plants, though the firm said it will consider exceptions to this rule over the next thre years in regions that do not possess “practical near-term alternative energy sources”.
It is the world’s largest publicly-traded property and casualty insurance company, with operations in more than 50 countries, making the move all the more significant in an industry that has so far remained largely indifferent to the fossil fuel issue.
This is unlikely to remain the case for much longer, however, as the industry reportedly endured $76bn in losses from natural disasters in 2018, with experts linking many of them, including the wildfires in California, to warming temperatures.
In Europe, the story is somewhat further ahead, with the likes of Axa, Allianz, Scor, Zurich, Swiss Re and Munich Re all making public efforts to divest from coal and cease selling insurance to any firms that use or produce it.
Some observers have posited that Chubb’s decision will exert greater pressure on the firm’s fellow major US insurers, such as AIG and Travelers.
