The Net-Zero Insurance Alliance (NZIA) has lost nearly half of its members as insurance companies around the world balk at political attacks on ESG policies led by the Republican party in the US.
Japanese insurer Tokio Marine is no longer listed as a member, while another Japanese firm, MS&AD Insurance Group, announced it was leaving just a year after joining. The company said it would still “continue our journey to achieve net zero by 2050 with our stakeholders”.
The exodus of insurance companies has left the UN-convened group down to just 14 members from a total of 30 in March. The remaining members are expected to hold calls on whether the alliance can continue, Reuters reported.
Republican politicians have put pressure on financial institutions which have committed to taking action against climate change. On 15 May, a group of Republican state attorney generals wrote a letter to members of the NZIA and Net-Zero Asset Owner Alliance which raised questions on the legality of their pledge and whether the alliance was in violation of federal and state antitrust laws.
“The push to force insurance companies and their clients to rapidly reduce their emissions has led not only to increased insurance costs, but also to high gas prices and higher costs for products and services across the board, resulting in record-breaking inflation and financial hardships for the residents of our states,” the letter stated.
NZIA was started in 2019 and members commit to decarbonising their underwriting portfolios to net-zero levels by 2050. It is part of several climate alliances under the Glasgow Financial Alliance for Net Zero (GFANZ) group.
Meanwhile, insurance costs in some areas of the US have gone up as the climate crisis has led to longer droughts and more flooding in some states. State Farm recently stopped accepting new homeownership applications in California due to increased risks from wildfires.
This page was last updated June 5, 2023
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