Allianz to stop insuring coal industry amid climate concerns
May 4, 2018
Insurance giant Allianz has announced it will no longer support the coal industry in a move designed to strengthen the transition to a low-carbon economy.
The German company, which has €1.9 trillion of assets under management, will stop selling insurance to both single coal-fired power plants and all planned and operating coal mines, effective immediately.
Companies that have fossil fuel assets as part of its portfolio, along with renewable energy, will continue to be insured, but subject to review under strict environmental criteria.
The decision is part of its new strategy to support global efforts under the Paris climate agreement to limit global temperatures below 2 degrees Celsius.
In a statement, Allianz said it will “no longer invest in energy companies that put the two-degree target at risk by extensively building coal-fired power plants.”
In doing so it has become one of the first insurance companies to commit to the science-based targets initiative, designed to help corporates effectively cut emissions to prevent the impacts of climate change.
This means that by 2040 it will phase-out the carbon footprint of its own operations, increasing its renewable energy commitments and reducing its own exposure to the coal industry.
Oliver Bäte, Allianz’ CEO said that “climate change generates enormous economic and social risks. It is already harming millions of people today…As a leading insurer and investor, we want to promote the transition to a climate-friendly economy.”
Dr. Günther Thallinger, an Allianz board member said: “As a long-term investor, we want to shape the change to a climate-friendly economy together with our clients. We will thus also strategically develop our investment opportunities in new technologies.”
Allianz is the latest insurance company to signal its intention to divest from the fossil fuel industry, especially coal as one of the most carbon intensive energy sources.
AXA has also stopped insuring coal plants and divested a total of €2.4 billion as of the end of 2017. It also removed its significant holdings in the oil sands industry, while planning to increase clean energy investments to €12 billion by 2020.
Lloyd’s of London and the Generali Group have similarly made commitments to back away from the industry.
Photo Credit: Calistemon/CC