Faced with the challenges posed by the climatic and environmental upheavals of the planet, ecology is indeed a concern that is becoming increasingly important to all players in the economy. The insurance industry is no exception. Unable to keep away from these developments which affect the whole of society, it is gradually evolving towards more ecological responsibility.
Towards an eco-responsible insurance sector
The insurance sector is adapting to follow the concerns of customers in favor of more ecology, to improve their image of course, but not only. Insurers, whose business is risk management, are at the forefront of observing the upheavals linked to climate change. Over the past few decades, the cost of climatic hazards, in France and around the world, has continued to increase and should weigh even more heavily in the future. For example, hurricane Sandy, which hit the United States in 2012, will have cost insurers between 20 and 25 billion dollars, and storm Xyntia, which hit western France in 2010, cost 1.5 billion euros. The French Federation of Insurance Companies (FFSA) estimates that compensation for natural disasters should double over the next 20 years.
The ever-increasing costs due to natural disasters and their difficult to identify nature pose a real threat to insurers, forcing them to reinvent themselves. Being at the heart of all economic activities, insurance companies are the main interested parties in the consequences of climate change, but they are also very well placed to promote more responsible behavior.
More incentive insurance premiums
It is in the interest of insurers to offer ecological insurance policies, the sector has also made many efforts in terms of accountability and is relatively innovative in this area.
Thus, many car insurers have implemented incentives that promote the use of alternative transport, in particular by applying reduced insurance premiums to customers subscribing to a means of public transport. They also often offer preferential rates for less polluting vehicles, applying reductions proportional to the decrease in carbon dioxide emissions of the vehicle. In terms of housing, some companies also offer lower rates to residents of ecological houses that consume very little energy.
Insurance that promotes the financing of the ecological transition
As asset managers, insurance companies, more than any other investors, have significant responsibility and power in financing green activities. Some companies, as part of a long-term vision, have implemented a policy aimed at directing their investments towards more eco-responsible economic players, in particular by developing specific financial products. Emphasizing ethical criteria in the choice of investments makes it possible to promote the financing of activities that take into account environmental and general interest issues. In order to retain new customers on more targeted products, insurance companies are therefore increasingly putting forward a more ecological company policy. If the real effects are weak, this at least has the merit of reflecting an awareness of insurers regarding environmental issues. A way perhaps to ensure a future.
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