AXIS Capital Holdings Ltd. won’t insure, invest in or provide insurance or reinsurance for new coal plants or oil pipeline as part of an initiative designed to reduce climate risks and support the switch to renewable energy.
The new policy kicks in on Jan. 1, 2020.
“We believe insurers have an important role to play in mitigating climate risk and transitioning to a low-carbon economy,” AXIS President and CEO Albert Benchimol said in prepared remarks about the decision.
Benchimol explained that the new policy fits with the company’s broader strategies, including “reducing investments in lines that do not align with our long-term approach; investing in growth areas, such as renewable energy insurance where we are a top five global player; and growing our corporate citizenship program, a core focus of which is creating a positive environmental impact.”
AXIS will not provide insurance or facultative reinsurance for the construction of new thermal coal plants or mines and their dedicated infrastructure; oil sands extraction and pipeline projects and their dedicated infrastructure, according to the new policy. The company will also decline to cover companies that generate 30 percent or more of their revenues from thermal coal mining, generate 30 percent or more of their power from thermal coal, or hold more than 20 percent of their reserves in oil sands.
AXIS said the policy is a component of a broader corporate citizenship program led by AXIS General Counsel Conrad Brooks and overseen by Benchimol and the Corporate Governance and Nominating Committee of the AXIS Board of Directors. The program focuses on four key areas: environment, diversity & inclusion, philanthropy and advocacy.
Additionally, AXIS said its new policy addresses renewals for and investments of fossil fuel-related clients. The company said that renewals will be considered on a case-by-case basis until Jan. 1, 2023. Limited exceptions are possible until Jan. 1, 2025 in countries where sufficient access to alternative energy sources is not available.
Regarding investments, AXIS said it will no longer buy into companies that generate 30 percent or more of their revenues from thermal coal mining, that generate 30 percent or more of their power from thermal coal, or that hold more than 20 percent of their reserves in oil sands.
Source: AXIS Capital Holdings Inc.