Chubb LTD is making headlines for becoming the first major U.S. insurance company to divest itself from coal. Traditionally, the insurance industry has always been a major supporter of coal, but as climate change has become more mainstream, people have been pressuring insurance companies to move into more sustainable waters.
Chubb LTD is currently the largest commercial insurance company in the United States, which makes it all the more notable that they are moving away from insuring and investing in coal. Chubb is the first U.S. insurance company to divest from coal, but the movement has been growing across the world. Over a dozen insurers from Europe and Australia have already enacted similar policies.
Evan G. Greenberg, Chubb LTD chair and CEO, released a statement about the company’s decision to move away from coal. “Chubb recognizes the reality of climate change and the substantial impact of human activity on our planet,” read the statement. “The policy we are implementing today reflects Chubb’s commitment to do our part as a steward of the Earth.”
Experts expect more insurers to follow in the footsteps of Chubb, if not for the sake of fighting climate change itself, than for their bottom line. A lot of the future costs of climate change are going to be shouldered by the insurance industry. As more natural disasters occur, more (and more expensive) claims are going to be filed, which insurers are going to have to pay out.
Mary Anne Hitt, director of the Sierra Club’s Beyond Coal campaign released a statement following Chubb’s announcement addressing climate concerns in the insurance industry. “Chubb’s announcement is a clear sign that coal is becoming uninsurable worldwide,” said Hitt. “With the U.S. industry joining this global trend, governments and power utilities should see that the industry is moving beyond coal.”
As the world’s climate changes so to must industries tied to traditional fossil fuels. Chubb LTD is leading the way in the United States, but it is not unreasonable to expect many more insurers to follow suit in the near future.