U.S. Lawmakers Ask Insurers to Stop Underwriting Fossil Fuels

A group of Democratic lawmakers, mostly from the Congressional Progressive Caucus, has asked some of the country's largest insurance companies to stop underwriting new fossil-fuel projects that contribute to climate change.

Source: Bloomberg | Published on April 27, 2022

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Representatives Mondaire Jones and Alexandria Ocasio-Cortez of New York, as well as Jared Huffman and Adam B. Schiff of California, were among 16 lawmakers who sent letters to more than a dozen insurance companies on Wednesday, including American International Group Inc., Berkshire Hathaway Specialty Insurance Co., and Chubb Ltd.

According to the letters, "the insurance industry profits from the expansion of fossil fuels while ripping the rug out from under the communities most affected by climate change."

The International Energy Agency has stated that no new fossil fuel projects can be developed in order to avoid the most catastrophic effects of climate change. The letter also chastised insurers for reducing services and raising prices in areas most vulnerable to climate threats, such as wildfires.

The letters come at a time when insurers are attempting to distance themselves from fossil fuels and achieve carbon neutrality goals.

AIG committed to a net-zero greenhouse gas emission plan last month, which included a moratorium on investing in and insuring the construction of new coal-fired power plants, thermal coal mines, and oil sands projects. Similar steps have been taken by other insurers, with more than 20 of the world's largest insurers committing to transitioning their portfolios to net-zero emissions by 2050.