Global reinsurer Munich Re has withdrawn from the Net-Zero Insurance Alliance (NZIA). Munich Re is, however, sticking to its already declared climate targets.
Munich Re CEO Joachim Wenning in a press release said, “In our view, the opportunities to pursue decarbonization goals in a collective approach among insurers worldwide without exposing ourselves to material antitrust risks are so limited that it is more effective to pursue our climate ambition to reduce global warming individually." The climate targets set for itself by Munich Re say that in a first step, green house gases’ (GHG) emissions related to the investment portfolio will be reduced by 29% by the end of 2025 and thereafter successively brought down to net zero by 2050.
As for the exploration and production of oil and natural gas (primary insurance, direct and facultative reinsurance), Munich Re will be reducing its climate-related industry exposure in such a way that there will be no associated net GHG emissions by 2050.
In a first step, Munich Re aims to reduce emissions by 5% by 2025. As of April 2023, the reinsurer will not insure projects involving new oil and gas fields or new midstream oil infrastructure. At the same time, Munich Re will reduce thermal-coal-related exposure in its direct and facultative insurance business by 35% group-wide by 2025, before eliminating this exposure altogether by 2040.
Munich Re since 2018 has stopped insuring new coal-fired plants, coal mines and since 2019 oil sand mines.
Regarding the emissions from its own operations, Munich Re has been carbon-neutral since 2015 and previously reduced CO2 emissions per employee by 44% from 2009 to 2019. Current GHG emissions are to be reduced by a further 12% per employee by 2025 By 2030, Munich Re expects to achieve net-zero GHG emissions in its operations.
Mr. Wenning said, "Our climate commitment is unwavering. We follow scientific recommendations. To date we are decarbonizing even faster than what is required to reach net zero by 2050."
Thirty of the world’s leading insurers and reinsurers are members of the UN-convened NZIA. These (re)insurers have committed to transition their insurance and reinsurance underwriting portfolios to net-zero greenhouse gas (GHG) emissions by 2050. NZIA was established in 2021 by eight (re)insurers together.