Renewables and carbon transition technologies underwriting may not be a growth area for the insurer just yet, but insurance companies would not be playing their part if they weren’t backing enterprises driving a green push, Aviva Canada Global Corporate & Specialty MD Urs Uhlmann has said.
“We certainly want to play our part in making sure that the carbon transition can take place,” Uhlmann told Insurance Business.
“If we don’t provide insurance solutions for new technologies in this space then in my opinion we’re not taking our share.
“The aim [of growing this part of Aviva’s business] is more for that – of course, I like to make money with it, but it’s more for that than thinking this is a big growth area in relative terms; it’s not at this point.”
Uhlmann, a former Zurich Canada global corporate CEO and AXA XL Canada CEO and chief agent, spoke during an interview with Insurance Business at RIMS in September.
Quizzed on what emerging risk he believed large corporates need to be paying attention to, Uhlmann pointed to a phrase from the World Economic Forum Risk Report: “climate action failure”.
“I do think that if we don’t get going on this … as an as an industry, as an economy, we’re going to be in trouble,” Uhlmann said.
“I don’t even know whether we can avoid trouble, but it’s high time to do more.”
Underwriting emerging technologies is one facet that insurers can tackle when looking to play a role in stifling the climate challenge, but they should also be encouraging their clients to take a proactive approach, according to Uhlmann.
“It’s also [about] helping our customers in setting their own targets and pushing them a little bit to move forward,” he said.
Aviva has started doing that with suppliers, Uhlmann said, but increasingly wants “to do the same with customers”.
From 2024, federally regulated banks and insurers will be required to publish climate disclosures, according to the Canadian government’s 2022 April budget. Aviva began reporting on climate change in 2004, the business has said, with climate-related financial disclosures having been made since 2017 following recommendations from the UK’s Financial Stability Board’s Taskforce for Climate-related Financial Disclosure.
“I certainly think that this is one of the areas where we barely see anything right now,” Uhlmann said.
“A year from now, I think it will already be different – just how we transact our business, what we report on, what we ask people, and ultimately that will translate into some measurable action.”
While the Aviva Canada GCS boss had a strong message on climate action, he cautioned that attempts to limit exposure to – or cut off – certain industries could have come off as “dictatorial”, though he acknowledged that given Aviva is “not in oil and gas, it’s easy for us to just stay on the sidelines”.
In recent years, global insurers have faced growing pressure from activists to end underwriting for fossil fuels and play a more active role in the climate focused transition.
“We have certainly set clear goals, so have others – to be fair, most of the big European insurers have, some of them way before Aviva I would say, tried to take action; I don’t think anyone has tried to do it in a coordinated way,” Uhlmann said.
“And it probably came out more dictatorial than anything – kind of like, ‘we’re not touching you if you have a refinery or if you’re extracting oil and gas and all those things’, and now I think the industry is hopefully, in a sense, smartening up and seeing that just not doing it may not be the real solution.”
Nevertheless, the Aviva GCS MD said, “pressure” needs to continue to be put on businesses in different ways – including by showing different stakeholders how climate transition attempts can benefit them.
For Uhlmann, part of tackling the climate challenge will be in looking to spread expertise.
“[We may not be in oil and gas] but there’s many other industries, or even just small businesses – we’ve got a huge small business portfolio – how can we help them?” Uhlmann said.
“There’s an area where we in the large corporate space can learn from our customers – many of them do have very evolved strategies – and distill that down and share it with our small business customers.”
