As of this month, Munich Re will stop insuring projects involving new oil and gas fields or new midstream oil infrastructure. The decision follows the reinsurer’s move to discontinue its membership in the Net-Zero Insurance Alliance (NZIA).
The UN-convened NZIA is a group of 29 leading insurers and reinsurers representing about 15% of world premium volume globally. NZIA members have committed to transition their insurance and reinsurance underwriting portfolios to net-zero greenhouse gas (GHG) emissions by 2050.
Munich Re CEO Joachim Wenning said: “In our view, the opportunities to pursue decarbonisation goals in a collective approach among insurers worldwide without exposing ourselves to material antitrust risks are so limited that it is more effective to pursue our climate ambition to reduce global warming individually.”
Already since 2018, Munich Re has stopped insuring new coal-fired plants, coal mines and since 2019 oil sand mines. As part of its climate change effort, the reinsurer will reduce thermal-coal-related exposure in its direct and facultative insurance business by 35% group-wide by 2025, before eliminating this exposure altogether by 2040.
As a first step in its individual climate change effort , Munich Re plans to reduce its GHG emissions linked to its investment portfolio by 29% by the end of 2025 and then successively bringing it down to net zero by 2050.
Regarding emissions from its own operations, Munich Re said it had been carbon-neutral since 2015 and previously reduced CO2 emissions per employee by 44% from 2009 to 2019. Current GHG emissions would be reduced by another 12% per employee by 2025. By 2030, Munich Re expected to achieve net-zero GHG emissions in its operations.
“Our climate commitment is unwavering. We follow scientific recommendations. To date we are decarbonizing even faster than what is required to reach net zero by 2050,” Wenning said.