On October 13, 2022, the Illinois Department of Insurance (the “Department”) issued Company Bulletin 2022-16 (the “Bulletin”). The Bulletin is addressed to all domestic insurers and advises that the Department will now participate in the National Association of Insurance Commissioners Climate Risk Disclosure Survey (the “Survey”).
Read MoreIn October 2021, the Financial Stability Oversight Council (FSOC) published its inaugural Report on Climate-Related Financial Risk making over 30 recommendations to U.S. state and federal financial regulators on how best to identify and address climate-related risks to the financial system. At that time, FSOC formed a new staff-level interagency committee, the Climate-related Financial Risk Committee (CFRC). At last week’s FSOC meeting, CFRC members reported their progress and released a Fact Sheet emphasizing interagency coordination and capacity building, in particular emphasizing data and methodological gaps. FSOC members reported on international and interagency cooperation prioritizing data collection and harmonization of reporting methodology.
Read MoreThe New York Department of Financial Services (DFS) issued its 2021 Update on New York Domestic Insurers’ Management of the Financial Risks from Climate Change, analyzing 2021 survey responses from the National Association of Insurance Commissioners (NAIC) Climate Risk Disclosure Survey or alternatively the Task Force on Climate-Related Financial Disclosures (TCFD). The report summarizes the submissions made by domestic insurers, highlights advances over the previous year, and reiterates DFS expectations while providing examples of good practices.
Read MoreConcerned about anecdotal evidence of diminishing availability of property insurance coverage in areas subject to disasters exacerbated by climate change, the Treasury Department announced on Thursday, June 7, that it is planning to launch the first nationwide assessment of insurers’ financial exposure to climate risk.
Read MoreFollowing on the heels of the New York Department of Financial Services (“NYDFS”), the National Association of Insurance Commissioners (“NAIC”) and the U.S. Security and Exchange Commission (“SEC”), the Connecticut Department of Insurance on April 22, 2022 proposed guidance for domestic insurers on managing climate change financial risk. Like the NYDFS, the NAIC and the SEC programs, the proposed guidance is based on the framework develop by the Task Force on Climate-related Financial Disclosure (“TCFD”).
Read MoreOn April 18, 2022, the California Department of Insurance (“CDI”) released its Climate Risk & Resilience Analysis Survey performed by S&P Global Market Intelligence. The survey’s analysis assessed insurer investment portfolios from December 2018 to December 2019 and reviewed insurer investments in the fossil fuels and energy sectors, under the EU green taxonomy, and in green bonds. Through the report, the CDI is attempting to understand the exposure of the California insurance industry to financial risks associated with insurer investments in oil, gas, coal and electric utilities. The CDI has also started assessing insurer investments in green assets with the purpose of tracking the transition to a more sustainable economy.
Read MoreThe NAIC adopted at its April 7 meeting the recommendations of its Climate Risk & Resiliency Task Force to revise its Climate Risk Disclosure Survey. As we described in our Locke Lord QuickStudy: Insurers Hit with Two Climate Disclosure Developments on the Same Day, the revisions make the Survey consistent with the international Task Force on Climate-Related Financial Disclosures (TCFD) disclosure framework.
Read MoreOn March 21, the Securities and Exchange Commission and the National Association of Insurance Commissioners both proposed significant revisions to climate disclosure rules. If adopted, these rules would require affected insurers to disclose climate-related risk assessments and management at the board and C-Suite level and, in some instances, Scope 3 greenhouse gas emissions.
Read MoreThe Intergovernmental Panel on Climate Change (IPCC) has been publishing assessment reports describing expected climate change impacts and risks since 1990 and has warned of the growing risks from climate change in each report.
Read MoreReports in the first month of 2002 by accounting firms and academics are highlighting key ESG issues for the insurance industry. Deloitte released its 2022 CxO Sustainability Report, which offers a glimpse into the key ESG issues companies should consider this year. The survey was conducted amongst 2,000 executives in 21 countries.
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