This archive report was first published on 3 December 2019.
December 3, 2019
Activist groups have reported a significant increase in insurers turning their backs on coal, with the number more than doubling in 2019.
According to the Unfriend Coal campaign, a coalition of environmental groups, 17 of the world's biggest insurers controlling 46 percent of the reinsurance market and 9.5 percent of the primary insurance market have announced coal exit policies.
This shift has made it increasingly difficult for coal projects to secure insurance, with certain projects already being unable to obtain coverage, said the Unfriend Coal campaign.
"This action is having a tangible impact," the campaign stated, citing brokers who reported increasing costs to insure coal facilities.
Coal, the dirtiest fossil fuel and biggest contributor to human-made climate change, is now at a commercial disadvantage due to increasing operating costs and the inability to secure insurance.
The report highlighted the struggles of the Indian group Adani, which has had difficulty finding insurance to develop the Carmichael coal mine in Australia.
At least 16 international insurers have ruled out underwriting the project, making it impossible for Adani to raise finance for the project.
"The industry's retreat from coal is gathering pace as public pressure on the fossil fuel industry and its supporters grows," said Peter Bosshard, coordinator of the Unfriend Coal campaign.
However, Bosshard noted that major US and Asian insurers continue to insure and invest in coal projects.
"All responsible companies must make coal uninsurable by ending support for both new and existing mines and power plants," added Bosshard.
France's AXA was the latest to announce plans to exit coal, pledging to make a complete pullout from coal investments by 2040.
Reinsurance firm Swiss Re was the top-ranked firm for both its coal insurance and divestment policies.
