Business

Chubb cuts coal insurance exposure because of climate change

US coal power station Image copyright Getty Images

Chubb has become the latest major insurer to cut its exposure to the coal industry, citing climate change.

The firm will no longer underwrite the building and operation of new coal-fired plants or new risks for companies that generate more than 30% of their revenues from coal mining.

Chairman Evan G. Greenberg said Chubb accepts "the reality of climate change... on our planet".

Allianz, Hannover, and Lloyds Banking Group have scaled back coal insurance.

The Switzerland-based insurer does most of its business in the US, where President Donald Trump has vowed to revive the coal sector.

Chubb is thought to be the biggest insurer operating in the US to introduce the policy, and it could put pressure on firms such as AIG and Travelers to follow suit.

"Making the transition to a low-carbon economy involves planning and action by policymakers, investors, businesses and citizens alike," Mr Greenberg said in a statement.

Chubb said exceptions to the new policy would be considered until 2022, taking into account an insured company's commitment to reduce coal dependence and also regions that do not have practical near-term alternative energy sources.

Last week, Zurich broadened its restrictions on underwriting and investing in fossil fuels.

This included companies that generate more than 30% of their revenue from mining, or generating electricity from, the shale oil sector.

Zurich boss Mario Greco said at the time that given climate risks and the devastation natural disasters inflict on people and communities, "it is simply the right thing to do".

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