National Insurance Awareness Day is observed each year on June 28. This day was created as a day for people to review their personal insurance coverages. Recently, the Environmental Entrepreneurs (E2) held a the New York Venture Summit. E2 is a national, nonpartisan group of business owners, investors and others who advocate for policies that are good for the economy and good for the environment.
California Insurance Commissioner Dave Jones keynoted the event. He shared that California insurance companies collect $289 billion a year in insurance premiums and have over $7.5 trillion dollars in assets held. Commissioner Jones is the leader of a multi-state effort that administers the National Association of Insurance Commissioners (NAIC) Climate Risk Disclosure Survey, and he launched the California Department of Insurance Climate Risk Carbon Initiative requiring the reporting of fossil-fuel investments held by insurance companies.
He shared that while more U.S. insurers are improving their disclosure and management of climate risks, most are still giving it minimal attention, both in terms of risks and opportunities. The companies are evaluated on five core themes, including governance, climate risk management, the use of catastrophe modeling, greenhouse gas management, and stakeholder engagement.
“This thorough analysis of insurance company survey responses continues to be a valuable tool in the discussion about climate change and its impact on the insurance industry.” – Dave Jones
Jones urges all insurance firms to:
- Elevate climate risk leadership to the board and C-suite levels.
- Consider climate and carbon risks in investment portfolios.
- Engage with key stakeholders on climate risk and the benefits of policies that will strengthen climate resilience and reduce carbon pollution.
- Integrate climate risk into enterprise risk management frameworks.
As educated and responsible consumers, we should all be evaluating prospective insurance companies on their future risk. Knowing a company’s financial strength and their answers to the NAIC survey can help provide a clear picture if they are prepared for the risks of climate change.