Swiss Re withdraws from carbon emissions trading activities; Insurance industry still evaluating climate change issues
Swiss Re has enjoyed a reputation in the marketplace as an insurance market leader in climate change issues. However, apparently due to falling carbon prices and much weaker trading of carbon emissions allowances in European markets, Swiss Re has announced that it is closing its carbon emissions trading desk and will no longer be engaging in carbon trading activities. Swiss Re’s move seems somewhat surprising given some of its significant prior efforts in this area, including deals in China and having been scheduled as a speaker at the upcoming EU Emissions Trading Conference in July. In any event, Swiss Re’s move likely underscores the fact that the insurance industry will continue to view climate change issues through the lens of profit opportunities and act accordingly.
The insurance industry continues to spend considerable resources in evaluating climate change issues, as exemplified by a recent report jointly issued by Lloyd’s and the International Institute for Strategic Studies. The report focuses on four major areas: water scarcity, food supply, energy, and natural resources. The report also notes that the dramatic impacts from climate change bring “some specific opportunities and responsibilities for the insurance industry.”
