AXIS Capital has announced a new policy that will see it exit the market for insurance or facultative reinsurance for the construction of new thermal coal plants or mines, or oil sands extraction and pipeline projects.
The global provider of specialty lines insurance and treaty reinsurance said the policy is a component of a broader corporate citizenship program led by AXIS General Counsel, Conrad Brooks, and overseen by AXIS President and CEO, Albert Benchimol, and the Corporate Governance and Nominating Committee of the AXIS Board of Directors.
This policy, which extends to dedicated infrastructure for coal and oil sands projects, will also see the company no longer offer cover to companies that generate 30% or more of their revenues from thermal coal mining, generate 30% or more of their power from thermal coal, or hold more than 20% of their reserves in oil sands.
And, in terms of investments, AXIS said it will not make new investments in companies that generate 30% or more of their revenues from thermal coal mining, that generate 30% or more of their power from thermal coal, or that hold more than 20% of their reserves in oil sands.
The company added: “Renewals will be considered on a case-by-case basis until January 1, 2023. Exceptions to this policy may be considered on a limited basis until January 1, 2025, in countries where sufficient access to alternative energy sources is not available.”
This is part of a wider program that focuses on four key areas: environment, diversity & inclusion, philanthropy and advocacy, AXIS said.
Benchimol explained: “We believe insurers have an important role to play in mitigating climate risk and transitioning to a low-carbon economy. This policy is in line with our broader strategies such as reducing investments in lines that do not align with our long-term approach; investing in growth areas, such as renewable energy insurance where we are a top five global player; and growing our corporate citizenship program, a core focus of which is creating a positive environmental impact.”
Brooks added: “We strive to ensure that every business decision we make is guided by our corporate values, and we believe this new thermal coal and oil sands policy is the right thing to do for our planet and our business.”
AXIS joins several other insurance companies to make plans to exit or reduce their exposure to thermal coal including Zurich, Chubb, Suncorp, Generali, Munich Re and Vienna Insurance Group.
International Mining is currently putting together its first feature on Mining Insurance, which will be published in the November issue