General Insurance Article - Solvency II should embed sustainability


Insurance Europe has responded to a call for evidence by the European Insurance and Occupational Pensions Authority (EIOPA) on sustainability in Pillar I of Solvency II.

 Insurance Europe said that sustainable investments can often be good investment opportunities, if they match risk/return profile needs. In general, it noted that the attractiveness of any investment depends on a series of factors in the investment decision process and that environmental, social and governance (ESG) factors and risks are not enough on their own to consider a sustainable investment as a good investment opportunity.

 It is vital that Solvency II remains a modern and risk-based framework and avoids imposing investment limits based on a simplistic approach of classifying all assets into either green or brown. Solvency II should measure the risks that insurers are exposed to when investing and - only if there is proof that ESG factors can have an impact on the risk profile of an investment – should these be reflected in the framework.

 Insurance Europe also said it generally agrees with the explanation proposed by EIOPA for ESG risks and factors, but said that a series of barriers complicate the identification and assessment of climate change risks on a company-wide scale. These include the lack of clear rules for the classification of sustainable activities, lack of company-specific quantitative data, poor data quality and imprecise methodologies.
  

 Insurance Europe Response

Back to Index


Similar News to this Story

Insurers adopting AI more for growth and profitability
In this commentary, we provide an overview of key areas of insurance value chain that stand to benefit from artificial intelligence (AI) adoption as w
Key insights into systemic cyber risk
CyberCube and Munich Re: Joint experts publish report to advance the insurance industry’s understanding of systemic cyber risks. Cybersecurity experts
Comments as the Chancellors new Captives regime is announced
The London Market Group (LMG), LIIBA and IUA welcomes the announcement by Rachel Reeves, Chancellor of the Exchequer that HM Treasury will move ahead

Site Search

Exact   Any  

Latest Actuarial Jobs

Actuarial Login

Email
Password
 Jobseeker    Client
Reminder Logon

APA Sponsors

Actuarial Jobs & News Feeds

Jobs RSS News RSS

WikiActuary

Be the first to contribute to our definitive actuarial reference forum. Built by actuaries for actuaries.