Tokio Marine Holdings Inc has introduced new targets to accelerate its efforts toward supporting a decarbonised society.
The insurance giant, which said it considers climate change mitigation a key priority, detailed its strategy for developing insurance products that encourage decarbonisation while reporting progress in client engagement on this front.
As part of its broader environmental strategy, Tokio Marine has set an interim target to generate ¥45 billion in premiums from decarbonisation-related insurance products by the end of fiscal year 2026. This initiative is in line with the company’s goal of achieving net-zero emissions by 2050.
The decarbonisation-related insurance offerings cover a range of sectors, including renewable energy, electric vehicles (EVs), and energy storage systems.
These products are designed to support businesses involved in renewable energy projects such as solar and offshore wind power.
Additionally, Tokio Marine provides insurance coverage for EVs and energy storage, helping to mitigate the risks associated with the transition to cleaner energy sources. The company’s insurance also includes warranties for mergers and acquisitions in the renewable energy sector.
Tokio Marine Nichido & Fire Insurance Co (TMNF), the company’s primary non-life insurance arm, has been actively engaging with large corporate clients on decarbonisation strategies.
In a move announced in September 2023, TMNF pledged to engage with 200 major companies that contribute to about 90% of the insurer’s emissions linked to insurance policies.
As of fiscal year 2023, TMNF had reached Level 2 engagement with 104 companies, achieving 52% of its target. Level 2 engagement involves working collaboratively with clients to identify decarbonisation challenges and providing solutions, including tailored insurance products to address climate-related risks.
The company aims to achieve Level 2 engagement with more than 160 companies by 2030 as part of its long-term plan to reach net-zero emissions.
While Tokio Marine advances its long-term decarbonization initiatives, it is also responding to the immediate effects of climate change, such as rising temperatures in Japan.
The summer heat has triggered a significant rise in demand for heatstroke insurance, reflecting growing concerns about the health risks posed by extreme weather.
In response to the heatwave, Tokio Marine’s subsidiary, in partnership with NTT Docomo, launched a low-cost, short-term insurance product in mid-2023 specifically aimed at addressing heatstroke risks.
Other Japanese insurers have experienced similar increases in demand for such policies. For instance, Sumitomo Life Insurance Co reported more than 100,000 sales of its heatstroke insurance policy by July 2023, a considerable jump from the previous year. Mitsui Sumitomo Insurance Co also noted a rise in heatstroke-related coverage, particularly among younger and older policyholders.
The rise in heatstroke insurance reflects increasing awareness of the dangers posed by extreme heat. In response, Japanese insurers are developing new products and expanding their existing coverage options to better protect individuals against heat-related illnesses.
