RIO DE JANEIRO—Adhering to the Principles for Sustainable Insurance will enable insurers to play a bigger role in society and help them develop products and services that meet the needs of customers, a range of experts said at the launch of the principles in Rio de Janeiro on Tuesday.

By using the principles to work with policyholders and governments, insurers can play a role in reducing climate change risks and other environmental concerns and help their customers reduce pollution and improve their health, they said.

The principles, which have been developed over the past five years, were launched at the 2012 International Insurance Society Seminar, being held this week in Rio de Janeiro. Achim Steiner, under-secretary-general of the United Nations and executive director of the United Nations Environment Program—which worked with insurers to formulate the principles—said insurers were among the “earliest allies'' of the U.N. in looking at climate change as they understood the magnitude of the risks involved.

“The business of business is sustainable business…the principles of sustainable insurance can be a powerful means by which we can speak to a market but also to a public,” he said at the launch. The principles have 27 insurance company signatories including: Aegon N.V., Aviva P.L.C., AXA S.A., Bradesco Seguros S.A., Insurance Australia Group Ltd., ING Groep N.V., Mapfre S.A., Munich Reinsurance Co. and Swiss Re Ltd.

The four principles are:

• Insurers will embed in their decision-making environmental, social and governance issues relevant to the insurance business.

• Insurers will work together with their clients and business partners to raise awareness of environmental, social and governance issues, manage risk and develop solutions.

• Insurers will work together with governments, regulators and other key stakeholders to promote widespread action across society on environmental, social and governance issues.

• Insurers will demonstrate accountability and transparency in regularly disclosing publicly their progress in implementing the principles.

In practical terms, there are many ways that insurers can adhere to the principles, several insurance executives said.

In life insurance, for example, investment strategies can be structured to adhere to the principles and promote the interests of insurers, said Charles Anderson, CEO of Sovereign Services Ltd. in Auckland, New Zealand.

%%BREAK%%

“It would be really, really foolish for us to invest in things that are harmful to our customers,” he said. For example, tobacco products are one of the largest causes of death, so by avoiding investments in the tobacco industry, life insurers adhere to the principles and employ a sound investment strategy for their business interests.

On the auto insurance side, SulAmérica Seguros e Previdência in Rio de Janeiro has implemented a program where repairs to its insured cars only use water-based paints rather than oil-based paints, said Chairman Patrick Larragoiti Lucas.

The move reduces pollution and protects the health of auto repair workers, he said.

“Nearly 200,000 people have benefited from this program,” he said.

For agricultural risks, Sompo Japan Insurance Inc. developed weather index-based coverage for northeast Thailand, said Masatoshi Sato, chairman and CEO.

The program expands the role of insurance in the region, he said.

Click here to see full conference coverage.