Australian insurers have hit back against allegations they are dragging their feet on climate change awareness following a recent study into the disclosure of climate-related policies.
According to the report from the World Wide Fund for Nature (WWF), Australian insurers IAG, QBE and Suncorp disclose less information about the risks of climate change to customers relative to foreign insurers.
The WWF report positions itself as a “conversation-starter with the insurance industry”, contending that Australian insurers should be doing more to publicly disclose their position on climate change, including making clear how they plan on managing financial risks.
“Global warming will have significant impacts on the insurance industry through increased claims, reputational damage, decline in insurance affordability, and an increase in uninsurable sectors or geographies,” says WWF Australia Business Engagement Manager Monica Richter.
“Without full public disclosure of their climate-related risks and management strategies, Australian consumers and shareholders are left vulnerable to unexpected costs and regulatory shifts.”
The report states that all three insurers provide limited public disclosure of climate change related business risks and that none have made public disclosure of low carbon investment or divestment action.
Insurance Council of Australia CEO Rob Whelan says that the onus for climate change policy falls on the Australian government.
“It is the role of governments to protect communities from hazards such as floods, cyclones, storms and bushfires, and make appropriate planning decisions to account for anticipated changes in sea levels,” Whelan says.
“The general insurance industry closely monitors the climate change debate. Its focus is on the need for Australia to become more resilient, through government action, to the community’s increasing risk profile caused by extreme weather.”
“Investment strategies and statements by publicly listed companies are a matter for those individual companies,” Whelan adds.
Suncorp, active in lobbying government for mitigation in North Australia, says that its focus will be to continuing its work with government.
“Our General Insurance business is publicly advocating for greater investment in natural disaster mitigation to better protect property and communities, while addressing affordability issues by reducing the risk,” a Suncorp spokesperson says.
“Our focus is to work with governments and the community to identify ways of mitigating the effects of extreme weather events.”
IAG have taken a similar position regarding the report’s allegations, saying that their focus will continue to be to work alongside government and community to tackle climate risk.
“As Australia’s largest general insurer, we work tirelessly to mitigate the risks that climate change exposes our business, communities and economy to,” an IAG spokesperson says.
“IAG has focused its efforts on ‘prevention, rather than cure’ and have been actively working with government, businesses, communities and humanitarian organisations to improve our nation’s resilience to climate change.
“IAG will continue to disclose its work and position on climate change through government submissions, annual and sustainability reports and examine additional ways to communicate with the public.”