Industry Task Force
Insurance Task Force
At the invitation of The former Prince of Wales, Lloyd’s has brought together leaders from a number of the largest and most influential global insurance firms to form an Insurance Task Force (ITF) as part of the Sustainable Markets Initiative, to drive progress as a group and accelerate the pace of industry transitions towards a more resilient and sustainable future, putting Nature, People and Planet at the heart of global value creation.
The ITF, chaired by Lloyd’s Chairman Bruce Carnegie-Brown, has committed to supporting the global transition through delivering five key initiatives in 2021 that will provide innovative new insurance products and services, and critical financial and risk management support across a number of industries and geographies to drive positive change.
Latest news from the Insurance Task Force
Sustainable Markets Initiative Insurance Task Force (ITF) launches global pledge for sustainable supply chains
A key feature of the insurance sector is its role as an ‘enabler’, providing services across the whole of the global economy, with every home and business reliant on a range of insurance products. As an industry, insurers are making progress with reducing the carbon footprint of their direct operations, incentivising customers to reduce environmental impact and supporting them through the transition.
The ITF’s Global Supply Chain Pledge, led by Direct Line Group and AXA XL aims to drive greater sustainability across insurance industry supply chains.
13 major insurers and brokers have signed the commitment to take action and support their supply chain partners to make the green transition. Signatories have made a commitment to take into account the emissions within their direct supply chain by focusing on three key actions:
Encouraging and helping suppliers to set meaningful sustainability targets with an ultimate goal of adopting Paris-aligned Net Zero Targets: insurers and brokers will, during procurement processes and then through ongoing engagement with suppliers, encourage supplier firms to set meaningful sustainability targets with the ultimate goal of adopting Net Zero Targets – for example, a 50% reduction in global emissions by 2030 in advance of reaching Net Zero by no later than 2050.
Advance initiatives with a goal of measuring the carbon footprint of insurance supply chains and report transparently on progress: to support more sustainable supply chains, the sector will develop methodologies for assessing and measuring the carbon intensity of suppliers to identify hotspots. Once established, these methodologies will be used to identify suppliers that have lower footprints or those who are taking active steps to increase sustainability.
Work to tackle supply chain carbon hotspots: signatories are committed to promoting engagement across the sector to address parts of the supply chain with the largest carbon footprint and facilitate best practices to drive up sustainability. This will allow insurers to replicate and build on the stewardship approaches adopted by investors and drive change in the supply chain at a sectoral level, rather than only on a case-by-case basis.
The 13 organisations who have signed the Pledge are:
Association of British Insurers
Direct Line Group
Legal and General
McGill and Partners
Tokio Marine Kiln
Disaster Resilience Framework for climate-vulnerable countries
The ITF have launched a Disaster Resilience Framework for Climate-Vulnerable Countries. This framework aims to demonstrate the opportunity that exists to blend public and private investment with insurance that could reengineer and drastically improve disaster resilience in low- to middle-income countries who are most at risk from climate-exacerbated extreme weather events. It highlights the unique potential there is for multilateral development banks, international aid donor and the private sector to partner to create large scale, repeatable, efficient and high impact physical, economic and humanitarian financing and risk mitigation solutions for climate-vulnerable developing countries.
Sustainable Products and Services Showcase
The ITF have published a Sustainable Products and Services Showcase, presenting the wide-ranging innovative insurance solutions currently available to customers to develop, invest in and scale their sustainability initiatives, supporting green innovation across multiple sectors and geographies. It shows the critical role the global insurance industry is already playing in underpinning and safeguarding the efforts of multiple industries as they drive climate-positive action to adapt and transition to a sustainable future and comes as action from one of the five commitments the ITF signed up to deliver throughout 2021.
The former Prince of Wales
The insurance industry is exceptionally well placed to understand the impact of climate change and the damage it can cause to us all if we don’t take action now. This is why I am so pleased that a large number of the world’s leading insurance companies have joined together to identify how the insurance industry can help put Nature, People and the Planet at the heart of our entire economy.
Letter of Intent
The ITF recognises the vital role that the global insurance and reinsurance industry has to play in individually and collectively driving and accelerating the transition towards a resilient, net-zero economy through its deep expertise in risk mitigation and management, disaster resilience and recovery, and more than $30 trillion in assets under management.
Members of the ITF are committed to supporting the global transition by developing innovative products and services to support customers through the transition and encourage climate-innovation. In addition, the ITF is committed to mobilising capital to provide structures to improve disaster response and recovery in vulnerable economies to protect against the evolving impacts of climate change, and re-orienting investment towards climate-positive solutions to accelerate the growth of industries driving positive change, such as renewable energy.
In line with these commitments, the ITF is focusing its attention on delivering action across five specific areas throughout the remainder of 2021:
Driving insurance product and services innovation to empower commercial customers to develop, invest in and scale their sustainability initiatives, supporting green innovation across multiple sectors and geographies. As part of this initiative, the Task Force will launch at least two new insurance products to protect priority industries, such as nuclear energy, hydrogen and offshore wind, against an evolving risk landscape, in order to enable their accelerated growth.
Implementing sustainable processes across the insurance supply chain to encourage and incentivise individuals to take positive actions to live more sustainably. This will include launching an industry-wide framework to drive sustainable outcomes for customers, for example through introducing “build back better” claims clauses in home insurance policies to encourage customers to rebuild damaged properties with more sustainable materials in support of a net-zero transition.
Establishing a public-private disaster resilience, response, and recovery framework to help protect developing nations from the evolving economic and societal impacts of climate change, including the effects of increasingly frequent and severe weather events. The framework will leverage the insurance industry’s unique ability to combine an insurance product with risk management and loss recovery services, in order to increase preparedness for and limit the impacts of these events. Once developed, this solution will be rolled out across vulnerable countries to support better disaster response and recovery, with a pilot being initiated in 2021.
Developing a framework for accelerating and scaling sustainable investment to help unlock the global (re)insurance industry’s more than $30tn in assets under management, increasingly directing capital towards investments that drive climate-positive outcomes in both developed and developing nations. As part of this initiative, an investment proposal will be developed through collaboration between public and private sectors, with a particular focus on renewable energy and climate transition assets to enable the transition towards a low-carbon economy.
Defining the industry’s ability to enable multi-sector transitions through developing an approach to measuring the carbon footprint across underwriting portfolios and establishing a framework to track the global insurance industry’s ability to support the transition towards net zero across multiple industries and geographies. Over time, this framework can be scaled to incorporate additional data and metrics as these become available.
The ITF is chaired by Bruce Carnegie-Brown, Lloyd’s Chairman, and championed by John Neal, Lloyd’s Chief Executive Officer. Its members are drawn from across the global insurance industry, including:
Bruce Carnegie-Brown, Lloyd's Chairman
As the world begins to recover from a pandemic that has caused significant and far-reaching financial and societal challenges, it does so with an opportunity to build back with sustainability as a foundation and guiding principle. Although climate change poses unprecedented systemic risk, it is one which – through partnership and accelerated action – we have the means to address. As a task force, we are making a resolute commitment to be a catalyst for action to help create a more sustainable future through the risks we manage and the capital we invest.