The Insurance Council of Australia (ICA) has released the 2024 edition of its “Climate Change Roadmap,” detailing ongoing efforts by the insurance sector to achieve net-zero emissions.
The report, titled “Towards a Net-Zero and Resilient Future,” outlined commitments made by ICA members and highlighted their preparations for forthcoming climate-related regulations.
Survey findings included in the roadmap show that 85% of respondents have committed to reaching net-zero by 2050, with 50% targeting operational net-zero by 2030. Additionally, 63% of participating insurers have tied climate-related metrics to executive compensation, reflecting the sector’s alignment with broader climate accountability trends.
The roadmap emphasised the industry’s readiness for mandatory climate disclosures, set to become a requirement for major Australian businesses in early 2025. Over half of survey respondents have already engaged with similar disclosure frameworks in other jurisdictions.
The report also highlighted innovative strategies being implemented by insurers, such as offering incentives for environmentally sustainable home renovations and bushfire resilience measures. These initiatives aim to reduce risk exposure while supporting the industry’s emissions reduction goals and managing costs for customers.
The ICA has expanded its efforts to assist members in adapting to climate challenges. Key initiatives include:
ICA chief executive Andrew Hall described the insurance industry as critical to managing the financial impacts of extreme weather events.
He noted that climate-related disasters currently cost Australian homeowners around $4 billion annually, with broader economic costs projected to reach $35.2 billion per year by 2050.
“Our members are stepping up to the plate by preparing for climate disclosures and taking action now to reduce emissions,” Hall said.
Aside from releasing the 2024 edition of its Climate Change Roadmap, the ICA has welcomed a Senate Select Committee report on the effects of climate risk on insurance premiums.
The report highlighted the growing cost of insurance linked to extreme weather and emphasised the need for targeted policy interventions to improve access and affordability.
Hall stressed the importance of collaboration among insurers, governments, and other stakeholders to balance affordability challenges with effective risk reduction measures.
“The ICA and its members thank the committee for their work inquiring into this important issue,” he said. “We look forward to continuing our collaboration with all levels of government and broader stakeholders.”
