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Democratic lawmakers have called on U.S. insurers including American International Group Inc., Berkshire Hathaway, Chubb Ltd., Liberty Mutual Insurance Co., MetLife Inc. and Travelers Cos. Inc. to explain how their fossil fuel underwriting policies align with their commitments to sustainability.
In a letter dated March 24, Sen. Sheldon Whitehouse, D-Rhode Island, and Senators Jeffrey A. Merkley, D-Oregon, Elizabeth Warren, D-Massachusetts, and Chris Van Hollen, D-Maryland, request information on each insurer’s fossil fuel underwriting and investment policies.
“An increasing number of your competitors have stopped underwriting coal and other fossil fuel projects and/or restricted their investments in coal and certain dirty and environmentally damaging oil and gas projects such as tar sands,” the letter said.
The physical risks of climate change pose a serious threat to insurers on the asset side and claims side of the business, the senators wrote. Transition risk is also significant for insurers that hold large stakes in fossil fuel assets, they said.
Insurers are asked which climate scenarios they have studied and whether they have conducted a stress test of their company’s exposure to fossil fuel assets.
“We recognize the risk of climate change to our planet and communities, and environmental sustainability has been a key focus for us for some time. We appreciate the opportunity to share with the senators the important work we’re doing in this area,” a Liberty Mutual spokesperson said via email.
To date, at least 26 insurers globally have ended or limited their coverage for coal projects, according to the Insure Our Future campaign.
The letter requests insurers to respond by April 16.
Risk managers face evolving climate-related liabilities and exposures as they grapple with rising losses from unusual weather events and rapidly changing climate policies in the United States.