Regulators Find Fossil Fuel Investments Could Generate Billions in Losses for Insurance Industry
Three west coast states release findings from stress test of insurance company investments
WASHINGTON, D.C. – In newly released findings from California, Oregon, and Washington states’ insurance regulators found insurance companies could face billions of dollars in losses if they continue to invest in the industries causing climate change. The analysis, released Tuesday, is part of a “stress test” of insurance company investments by the three states. Carly Fabian, insurance policy advocate with Public Citizen’s Climate Program issued the following statement:
“Homeowners on the West Coast are already experiencing the devastating costs of the industry’s short-sighted approach to the climate crisis. The findings of this stress test are a clear warning that insurers continue to pursue investment strategies that fail to account for transition away from fossil fuels. While this stress test is a significant step to acknowledge the problem, regulators must also address insurers’ underwriting and take bold action to require insurers to align their business with Paris Agreement targets.
“While more and more insurers make public climate commitments, loopholes in these commitments, the failure of the industry’s own net zero alliance, and an ongoing investigation from the Senate Budget Committee all highlight a need for rapid intervention by regulators. So far, insurers have offloaded climate costs to the public, but in dragging their feet on emission reductions, they underestimate the risks to their own companies, their markets, and the broader financial system. The commissioners should take the next step by requiring insurers to provide and implement credible plans for the transition to a clean-energy economy.”
Further Reading:
- September 2023: Covering Coal: The Top Insurers of U.S. Coal Mining
- January 2023: Letter to the National Association of Insurance Commissioners, Climate and Resiliency Task Force
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