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AIG Moves Towards Insuring Our Future

Public Citizen Analysis of Insurer’s new Climate Commitments

On March 1, 2022, American International Group (AIG) adopted new commitments to restrict support for coal, tar sands oil, and Arctic energy, and align its insurance and investments with net zero greenhouse gas (GHG) emissions by 2050. Public Citizen analyzed the commitments, concluding that AIG has moved itself from the bottom of the pack to a U.S. insurance industry leader on climate action.

By the Numbers

Among U.S. insurers, AIG’s commitments make it the:

  • first to commit to a phase out of fossil fuels;
  • first to commit to science-based emissions reduction targets;
  • first to restrict insurance and investment for Arctic energy projects;
  • third to restrict insurance and investments for tar sands oil; and
  • fifth to restrict insurance and investments for coal.

The analysis finds that, using the methodology from Insure Our Future’s annual report on 30 global insurers’ policies on fossil fuels, AIG would move from tied for last to #11 out of 25 for its restrictions on fossil fuel insurance. This is the highest rank of any U.S. insurer for this category. In North America, Bermuda’s AXIS Capital still ranks higher at #3. AXIS Capital’s commitments include ending support for any company developing new coal infrastructure and phasing out all coal insurance by 2030 in OECD countries and the EU, and by 2040 globally.

Questions Remain

Public Citizen’s analysis also identifies several questions that AIG’s commitments do not address, including the following:

  • Ruling out support for fossil fuel expansion. The International Energy Agency has made it clear that new fossil fuel projects are incompatible with a pathway to net zero by 2050. AIG’s commitment to net zero does not explicitly rule out support for all fossil fuel expansion.
  • Definitions of tar sands projects. AIG’s new policy does not identify which tar sands projects are covered. Without clarification, AIG may still be insuring toxic tar sands transport projects including the Trans Mountain pipeline, which multiple Indigenous communities have strongly opposed.
  • Definitions of Arctic energy exploration. As the Gwich’in Steering Committee points out, AIG does not define whether its restrictions include just the Arctic National Wildlife Refuge or, more broadly, areas north of the Arctic Circle globally. The policy also does not specify whether it covers both oil and gas, and how exploration activities are defined.

AIG declined to answer questions from Public Citizen and allies to clarify details of its policy.

The report further outlines what steps AIG should take to meet its commitment to align with climate science and the goals of the Paris Agreement. We look forward to seeing a detailed implementation plan and timeline for its phase out of fossil fuels, along with its other commitments.

Public Citizen and the Insure Our Future network will continue to call on AIG to align with a safe climate by meeting the following demands:

  1. Immediately cease insuring new and expanded coal, oil, and gas projects.
  2. Immediately cease insuring coal companies, unless they have a coal exit plan that commits to close all coal-related assets by 2030 in EU/OECD countries and by 2040 globally.
  3. Phase out, in line with a 1.5°C pathway, insurance for oil and gas companies.
  4. Divest all assets, including assets managed for third parties, from coal, oil, and gas companies that are not aligned with a 1.5°C pathway. Any company that is building new coal, oil, or gas expansion projects is not aligned with 1.5°C.
  5. Bring stewardship activities, membership of trade associations and public positions as a shareholder and corporate citizen in line with a 1.5°C pathway in a transparent way.
  6. Establish robust due diligence and verification mechanisms to ensure clients fully respect and observe all human rights, including the right to Free, Prior and Informed Consent (FPIC) as articulated in the UN Declaration on the Rights of Indigenous Peoples.

Read the analysis here.