Climate risk management in the U.S. insurance sector
This report is the first systematic review of U.S. insurance companies’ climate risk strategies, yielding new insights that risk managers and regulators can use to maintain a sustainable insurance sector. The goal of this analysis, which used two independent methods to review the responses, is to provide insights that may be helpful for other insurers in developing their climate-related disclosures and to encourage improvement in the comprehensiveness of those disclosures.
The analysis shows that insurance company responses to the Climate Risk Disclosure Survey demonstrate diverse, and sometimes sophisticated, approaches to climate risk management. The key findings include:
- The 2022 Climate Risk Disclosure Survey achieved a very high rate of response from insurance companies. There were examples of insurers across all types of business (Property & Casualty, life, health, etc.) and sizes that provided detailed disclosures according to the TCFD recommendations.
- 78% of the responses provided disclosure that broadly aligned with 6 or more of the 11 TCFD recommendations.
- Over 95% of the responses provided information that broadly aligned with the Risk Management and Strategy Pillars of the TCFD.
- Less than 40% of the responses provided information that broadly aligned with the Metrics & Targets Pillar.
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