The world's oldest insurance market, Lloyd's of London, is the latest member of the European insurance industry that will divest from coal, beginning in April this year. It will be discussing its new investment strategy at the World Economic Forum Annual Meeting in Davos this week.
In November last year, Lloyd's Corporation said that it would be implementing a coal exclusion policy for assets held in segregated portfolios as of April 1, 2018, as part of its responsible investment strategy.
"That means that in the areas of our portfolio where we can directly influence investment decisions we will avoid investing in companies that are involved mainly in coal," Inga Beale, chief executive at Lloyd's of London, told the Guardian on Sunday.
"Is there more the insurance sector could be doing to help the world transition to a low-carbon economy by choosing sustainable or low-carbon stocks?" Beale added.
According to the Unfriend Coal campaign-which is supported by environmental campaigners including Greenpeace and The Sierra Club-as of November 2017, leading insurance companies had pulled US$20 billion out of investments in coal, and a growing number refuse to underwrite new coal projects.
Switzerland's Swiss Re and Zurich are leading the insurers in actions not to support coal underwriting and coal investments, according to a report by Unfriend Coal.
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France's AXA was the first global financial institution to exclude investments in coal in 2015.
Last month, AXA said that it would be divesting US$700 million worth of interests in Canadian oil sands production and pipelines, stepping up its commitment to fight climate change.
AXA's oil sands divestment announcement came on the same day that the World Bank said that it would stop financing upstream oil and gas projects after 2019 as part of its support to countries in meeting their Paris Climate Agreement targets.
By Tsvetana Paraskova for Oilprice.com
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