Can insurance save the world?

Or, in less prosaic terms… will insurers stop underwriting fossil fuel projects? Should they? Right now - why would they?



Whatever your views on XR, their latest campaign has coincided with a bit of action, with Zurich pulling out of new fossil fuel exposure earlier this year.

But will we see wider adoption when, fundamentally, the risks being underwritten don’t account for the wider environmental impact?

(Or, with my economist hat on 🧢 - when we are not internalising the externalities!)



And while the industry is keeping a close eye on ESG regulatory advances - with CSRD prep, sustainability reporting and net zero goals trickling in - there’s less immediacy outside of this.

Not least as there’s less reputational pressure than in other sectors, with price driving retail sales and brokers owning commercial sales.



Ultimately, widespread scaling back needs the wider ecosystem - markets, regulators, governments - pushing to make fossil fuel projects less attractive (that is, more ‘risky’ for a given reward by, yep, internalising those pesky externalities 🧢)

And to end with a bit of optimism 🤞 Zurich has said that the measures are unlikely to significantly impact its bottom line… maybe we’re closer than we think commercially too. 🙂