ICA launches roadmap for insurers to hit net zero emissions

Last week, the ICA released a climate change roadmap, Towards a Net Zero and Resilient Future, which outlines the pathway for insurers to achieve net zero emissions.

The paper acknowledges the critical role general insurers play in protecting Australians from the impact of extreme weather events. It emphasises the need for further action to address the causes of extreme weather, as worsening events continue to affect the affordability and availability of insurance.

In support of strong climate change action, the ICA set out its long-term goal of working with the industry to rapidly reduce emissions in line with global targets for this decade, achieving net zero emissions by no later than 2050.

The roadmap provides an initial pathway for general insurers to achieve net zero emissions by 2030 across their own operations. This includes investment in energy efficiency, the installation of rooftop solar panels for office buildings and the transition of corporate fleets to electric vehicles.

Following this milestone, the paper outlines the pathway for general insurers to subsequently achieve net zero emissions by 2050 across their underwriting activities, the claims supply chain and investments.

This includes shifting underwriting and investment portfolios to new technologies driven by renewable energy, and introducing repair and restoration over replacement into the claims supply chain.

In addition to its net zero targets, the ICA has also urged for the general insurance industry to help strengthen Australia’s resilience to future weather events.

This includes taking actions such as sharing risk data with local governments and providing greater education to policyholders on risk mitigation.

By reducing emissions, as well as playing a role in building greater resilience, the ICA envisions that insurers will mitigate some of the impacts of a changing climate and ultimately improve the affordability and availability of insurance in Australia.

The Climate Change Roadmap is authored by Boston Consulting Group and draws on extensive consultation with the general insurance sector over the past 12 months

For more information on the Climate Change Roadmap, visit the ICA website here.