Survey: Client Attitudes on Climate Change
Guy Carpenter conducted a client survey in the first quarter of 2021 to assess where the industry is positioned relative to governance, physical climate change risk quantification, disclosure and strategy. We gathered nearly 50 responses, with findings consolidating along 4 different themes.
- Strategy:?84% of respondents wanted to start or develop their climate change strategy, citing primarily corporate responsibility and good governance as drivers. This shows there is appetite for clients to improve their understanding and action around this topic.
- Internal governance:?A majority of respondents said that climate change is a board-level issue, but only 20% are considering climate change holistically with a dedicated individual or team.
- Transition risk:?Half of companies are exiting the underwriting of thermal coal or other fossil fuel projects, while only 36% do not consider climate change in their investment risks.
- Physical risk:?Our clients are moving from qualitative assessment to quantitative ones, with 70% of respondents answering that they were quantifying the risk using tools such as adjustments to cat models and stress tests. Rising severity with adverse capital implications, risk accumulations and the potential rising cost of reinsurance were among their key concerns when considering physical risk.
Survey results will be collected on an annual basis to track the evolution of insurance industry expectations around climate change and ESG.