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| Tue, 11th Oct 2022 11:27:00 |
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Major insurer cuts off oil companies |
Climate activists looking to cut off the fossil fuel industry’s access to insurance celebrated last week: The world’s largest reinsurance company, Munich Re, announced new restrictions on its coverage of fossil fuel projects. (Reinsurance contracts cover primary insurers to help them spread their risks.)
Munich Re said that beginning next April, it will stop providing coverage for new oil and gas fields, new oil transport and storage facilities, and new oil-fired power plants. Munich Re also invests its insurance premiums, according to AP News, and the policy will apply to its investments as well. The moves are part of the company’s commitment to supporting the goals of the Paris Agreement.
“Munich Re’s policy sends a message to the wider insurance industry and to the oil and gas sector that they must act urgently to align their business with climate science,” said Lindsay Keenan, the European coordinator for Insure Our Future, in a statement. Insure Our Future is a campaign pressuring insurance companies to stop covering oil, gas, and coal projects in order to accelerate the winding down of fossil fuel production. Researchers have calculated that most of the world’s known oil reserves must stay in the ground to give humanity even a fifty-fifty chance of limiting global warming to 1.5 degrees Celsius (2.7 degrees Fahrenheit).
Munich Re joins other major reinsurers like Swiss Re and Hannover Re, which have announced similar restrictions on reinsuring oil and some gas projects in the past year. Munich Re’s new policy will not apply to coverage for new gas pipelines, liquefied natural gas plants, or gas-fired power plants.
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