Insurance Companies Try To Cancel Coal

By Ted Dieck | Recruiter’s View - Energy - ESG - International | Jun 9, 2023

The United Nations Environment Programme (UNEP) has been building its Finance Initiative (FI) for over 30 years.  By stitching together over 450 banks and insurance companies, UNEP has built $100 trillion of financial muscle to enforce its plans for environmental, social and governance (ESG).   

UNEP FI has “Principles for Responsible Banking and Principles for Sustainable Insurance, as well as three UN-convened net-zero alliances.”

It’s a big operation, implementing their global programs and supporting them at a regional level.

And that’s all great, if you’re a fan of ESG, the Paris Agreement on Climate Change, and the famous Global Reset.

Here’s what happens, when you start putting that financial muscle into these programs…

Let’s Kill Coal

Europe is going all-in on wind and solar power.  Europeans have a distaste for coal, oil, gas, nuclear, and probably other energy sources I’ve forgotten.

They want to stake their survival on windmills and solar panels.

So, it would be understandable that in 2015, the French insurance company AXA might become the first insurer to start divesting from coal.

That’s when AXA’s CEO Thomas Buberl realized that divesting from coal isn’t nearly as powerful as driving the coal industry completely out of business.

No Insurance Means No Funding

In a New York Times interview, Buberl explained why…
Underwriting is the key to driving out the coal industry.

There is always someone who will invest in coal.

But, if you can’t get insurance, you won’t be able to get financing from anybody.

“By bringing the majority of this market together, because [there’s] only let’s say 12, 15 actors globally who do this business… we will create a very powerful coalition to really drive this market out.”

Adding Partners

On July 11, 2021 AXA lead the founding of the Net-Zero Insurance Alliance (NZIA).

“Eight of the world’s leading insurers and reinsurers (committed) to accelerating the transition to a net-zero emissions economy, as required by the Paris Agreement.

“The eight founding members of the NZIA are AXA (NZIA Chair), Allianz, Aviva, Generali, Munich Re, SCOR, Swiss Re and Zurich Insurance Group.”

You might notice a shortage of U.S. based insurance companies.

Losing Partners

Just nine months later, Munich Re and Zurich Insurance Group had left the NZIA.

“Both Zurich and Munich Re were among the eight market players that launched the alliance, and while it’s grown to around 30 participants, it’s far from ideal that two of the original companies have decided to leave.”

U.S. AGs Explain The Law

Attorneys General from 23 states in the United States explained to the NZIA that it was breaking numerous well-established laws.  In a nine-page letter issued May 15, the AGs identified possible illegal boycotts and production restrictions.

An example of an illegal boycott:  NZIA targeting “selected clients,” placing environmental conditions—not actuarial ones—on the continuation of their insurance coverage.

I summarized the letter in 23 AGs Defend Coal.  It has a list of the signatories.  And I included a link to the letter, itself.

Insurers Leaving A Sinking Ship

Two weeks after the letter, the NZIA had lost nearly half its members.

Recruiter’s View

While the United States continues to cede leadership and authority around the world, individual states are willing to protect our energy industries.

As entire continents deliberately go out of the energy business, U.S. providers may discover increased opportunities.