Page 20 - Insurance Times June 2023

inadequate regulations, according to member organisation from the Net Tentatively named the Sustainable Fi-
an industry estimate. The sector, Zero Insurance Alliance. nance Platform, the venture is backed
known for insuring and reinsuring ma- by MS&AD Insurance Group (AioiNissay
This news takes the total now exited
jor and unconventional risks such as Dowa and Mitsui Sumitomo Insurance),
from the NZIA to nine major insurance
energy infrastructure and cyber Sompo Japan, Tokio Marine & Nichido
and reinsurance players.
threats, contributes nearly a quarter of Fire, Nippon Life, Hitachi, Mizuho
The QBE and Sompo Holdings exits
the City's economic output. Bank, Sumitomo Mitsui Banking, and
come right after two other big firms,
One of the main concerns highlighted MUFG Bank. This digital platform en-
namely AXA and Allianz, had an-
by Wagstaff is the "one-size-fits-all" ables a seamless connection between
nounced their exit from the NZIA.Scor an investment institution and a listed
regulation that treats all insurance
has also announced its exit from the company looking for investments, as
buyers equally, regardless of their
alliance recently. well as facilitation of mutual under-
complexity or sophistication.
With some major re/insurers having standing and disclosure of ESG-related
Another issue is the slow pace of regu-
withdrawn from the Net-Zero Insur- information.
latory authorisations, which is a prob-
ance Alliance (NZIA), the United Na- In a news release, the collaboration
lem across the financial sector as a
tions Environment Programme (UNEP) said that they will seek a wide range
whole. Financial regulators often fail to
has stated that there's a "fundamen- of user companies and will provide a
meet statutory deadlines for process-
tal and urgent" need for collaboration beta version of the platform sometime
ing applications and approving key ex-
with the global insurance industry to in fall of this year. The beta will work
ecutives within firms.
successfully tackle the climate emer- to verify the platform's usefulness and
The London Market Group is urging
gency. strengthen its various functions for the
regulators to provide a comparative
formal launch sometime in the future.
Swiss Re also withdrew from the NZIA,
analysis of the UK's performance com-
which was convened by UNEP Finance The beta version will allow listed com-
pared to other financial jurisdictions,
Initiative's Principles for Sustainable panies to confirm the items and back-
including approval rates, application
Insurance (PSI) at the G20 Climate ground of ESG information disclosure
processing times, and rejection rates.
Summit in Venice in 2021. directly and integrally, allowing them
While efforts are being made to im-
to understand what is valued by invest-
prove competitiveness, one area that Munich Re, Zurich Insurance and
ment institutions in advance so that
remains a concern is the development Hannover Re have already made their
businesses can determine internal dis-
of bespoke regulatory frameworks for exits. Meanwhile, another reason for
closure policies in an effective manner.
captive insurance companies. Other this could be due to a fear of losing
ESG investment reached US$35.3 tril-
jurisdictions have taken the lead in this business in the US, if they continue to
lion in 2020
regard, creating favourable conditions push the net-zero agenda while law-
for self-insured risks within a group of makers there on the Republican side According to the report, even though
companies. The UK government has are pushing back on ESG. ESG-related investments reached
promised further work in this area. US$35.3 trillion in 2020, common pub-
Japan insurers, banks an- lic standards for global information dis-
Despite the challenges, the London
closure and evaluation methods for
insurance market is generally in good nounce joint venture for
ESG-related non-financial information
health due to rising insurance costs.
ESG initiatives for investment decisions have not yet
Lloyd's, in particular, expects premi-
Several leading Japan insurers and been developed.
ums to increase from nearly £47 billion
banks have teamed up to announce a
in 2022 to £56 billion this year. With this initiative, the Sustainable Fi-
memorandum of understanding on nance Platform group hopes to pro-
joint studies of business initiatives to- mote effective and efficient communi-
QBE and Sompo the latest
wards the development of sustainable cation among investors, issuers, and
re/insurers to quit NZIA finance, as well as furthering the envi- other stakeholders, both in Japan and
QBE and SompoHolidngs have both ronmental, social, and governance overseas, as well as further expand
announced their resignations as a (ESG) framework. ESG investment and the market.
The Insurance Times June 2023 19