Ditching Coal Will Bring Long-Term Benefits, Insurers Told

The insurance industry’s anti-coal stance will deliver significant long-term benefits despite potential short-term losses, according to data and analytics company GlobalData.

The statement comes as more insurers pledged to reduce their exposure to the thermal coal sector and force the energy industry to embrace renewables.

“With climate change potentially causing the increased frequency of extreme weather events and rising sea levels, ceasing protection for fossil fuel-based energy providers may enable the industry to benefit from reduced exposure to potential environmental liability risks and enhance its public reputation,” said Daniel Pearce, insurance analyst at GlobalData.

AXA is extending its climate change policy to its recently acquired XL division, which means XL will no longer insure any construction projects related to coal-fired power plants and the extraction of tar sands.