Library: AXA XL – Be the change: Taking a lead in sustainability to build a more resilient future
Executive summary:
For me, the most rewarding part of being in the insurance industry has always been helping my clients recover – to see them pick up after something went wrong, bounce back, and carry on in their business. By providing the financial wherewithal to rebuild after suffering a mishap or impact from a natural disaster, we’re supporting our clients’ resilience.
Now though, after seeing continued patterns of severe weather (losses which totalled some US$130 billion in 2021), navigating through a global pandemic that knocked supply chains off kilter, and witnessing global inflation that no one has seen in 40 years, it’s clear that supporting resilience alone is not enough.
Resilience vs Sustainability
Feeling the impact of record-breaking losses, disruptions and added costs, it can’t be a surprise that insurers, like AXA, are paying more attention to sustainability issues given how these issues tend to generate claims. After all, we have a lot of skin in the game.
While we may not be able to directly control the weather that resulted in the majority of 2021’s losses, we can take a look at what is in our control to minimise the conditions or issues that may be contributing to current weather patterns and other societal challenges.
We’ll certainly continue to help our clients assess their individual risks and pay out on their coverage after a loss. We’ll look at their properties to make sure their roofs can withstand high winds, or their storage practices can protect supplies from flood waters, or sprinklers are in place should a fire erupt. That’s all about building resilience or giving our clients, as Merriam-Webster dictionary defines it, “an ability to recover from or adjust easily to misfortune or change.”
But then we need to look at the bigger picture. We need to see what we can do to minimise the root causes of these misfortunes or changes. That’s why we must also support sustainability initiatives aimed at reducing or eliminating environmental or social impact that tend to lead to unfortunate situations. It’s all about partnering with our clients to help build a more resilient future.
Taking a lead
Climate change, of course, is a big sustainability focus. This summer, the impact of recent record-breaking temperatures globally underlines the urgency that we can’t continue to operate like we’ve always done. To do their part, many companies are striving to achieve net zero greenhouse gas emissions by 2050. For insurers, like us, this net zero target requires implementing changes across global underwriting and investment portfolios. Axa’s coal underwriting restrictions and even newer oil and gas exclusions have been well publicised.
Making changes to spur on needed change is not an easy thing to do, but it’s nothing new for the insurance industry. From advocating for seat belt laws to pushing for improvements in building codes to finding ways to insure pollution liability and potential terrorism concerns, the insurance industry has always been in a unique position to shape and address change, designing innovative insurance products and risk management services that can support businesses and communities’ sustainability efforts and support greater resilience.
See the full report for more…
Link to Full Article:: click here
Link to Source:: click here