Association Of British Insurers Releases Guidance for Members on Taking Action Against Nature and Biodiversity Loss | JD Supra

The Association of British Insurers’ Action on Nature Guide

The Association of British Insurers (ABI) has published guidance (the Action on Nature Guide) setting out what insurers and long-term savings providers can do to help prevent biodiversity loss in the UK and become more “nature positive.” The ABI recognizes the challenge that many businesses face when trying to assess their impact or reliance on nature. Therefore, the Action on Nature Guide aims to assist member firms in better understanding the issues policyholders are facing and how they can protect themselves from the risks associated with nature and biodiversity loss.

Key Reasons for Taking Action

• Nature loss exposes the properties and businesses of policyholders to a wide range of risks, impacting markets and financial performance.
• Approximately half of global GDP – USD 44 trillion – is highly to moderately dependent on nature, according to studies cited by the ABI.
• There is a link between the physical and mental health of the human population and healthy ecosystems, impacting the business models of long-term savings providers, life and health insurers.
• There is a reputational risk of perceived inaction to prevent biodiversity and nature loss.
• The net zero transition cannot be achieved with new technologies alone, and nature plays an important part in decarbonization.

The Action on Nature Guide provides tools and best practice examples for expertise and guidance from external organizations. It also offers information on developing a heatmap as an estimation of potential impacts, as well as best practice examples from first movers in the sector. Additionally, the guide includes information on setting up internal working groups within firms to agree on guiding principles.

The ABI’s Action on Nature Guide is part of its Climate Change Roadmap, which sets targets for the sector to meet by 2025 in order to halve emissions by 2030 and reach net zero by 2050.

The ABI is one of several sector-focused bodies that have turned their attention to the prevention of biodiversity loss following the adoption of the Kunming-Montreal Global Diversity Framework (GBF) at COP15 in 2022. The GBF is an agreement among almost 200 countries to protect at least 30% of the planet’s lands, inland waters, coastal areas, and oceans by 2030.

Impact on Insurance Sector

Climate change considerations have a significant impact on coverage decisions in the insurance sector, as observed by Goldman Sachs Asset Management in its 12th annual insurance survey. The European Insurance and Occupational Pensions Authority also suggests that insurers could help reduce nature-related impacts through underwriting activities while mitigating risk to their investment portfolios.

Various insurers in the industry have adopted different stances on climate change. For example, Munich Re, the world’s largest reinsurer and a founding member of the Net Zero Insurance Alliance (NZIA), announced earlier this year that it would cease investment in and exclusive coverage of contracts and projects related to new oil and gas. However, some insurers, including Munich Re, have recently withdrawn from the Alliance due to U.S.-based challenges to membership based on antitrust grounds. Additionally, twenty-three Republican state attorneys general sent a letter to members of the NZIA expressing “serious concerns” about whether the NZIA’s requirements comply with federal and state laws, and demanding certain information.

SDGs, Targets, and Indicators

1. Which SDGs are addressed or connected to the issues highlighted in the article?

• SDG 13: Climate Action
• SDG 15: Life on Land

2. What specific targets under those SDGs can be identified based on the article’s content?

• SDG 13.2: Integrate climate change measures into national policies, strategies, and planning.
• SDG 15.5: Take urgent and significant action to reduce the degradation of natural habitats.

3. Are there any indicators mentioned or implied in the article that can be used to measure progress towards the identified targets?

• Indicator for SDG 13.2: Number of countries with integrated policies, strategies, and plans for climate change mitigation, adaptation, impact reduction, and early warning.
• Indicator for SDG 15.5: Red List Index, which measures changes in the overall extinction risk of species over time.

Table: SDGs, Targets, and Indicators

The article highlights the Association of British Insurers’ guidance on preventing biodiversity loss and becoming more “nature positive.” This aligns with SDG 15: Life on Land, which aims to protect, restore, and promote sustainable use of terrestrial ecosystems, sustainably manage forests, combat desertification, halt and reverse land degradation, and halt biodiversity loss. Additionally, the article mentions the sector’s targets to halve emissions by 2030 and reach net zero by 2050, which are related to SDG 13: Climate Action, specifically target 13.2 to integrate climate change measures into national policies, strategies, and planning.

The specific targets identified based on the article’s content are SDG 13.2 and SDG 15.5. SDG 13.2 focuses on integrating climate change measures into national policies, strategies, and planning, which is relevant to the sector’s targets to reduce emissions and reach net zero. SDG 15.5 calls for urgent and significant action to reduce the degradation of natural habitats, aligning with the sector’s efforts to prevent biodiversity loss.

The article mentions indicators that can be used to measure progress towards the identified targets. For SDG 13.2, the indicator is the number of countries with integrated policies, strategies, and plans for climate change mitigation, adaptation, impact reduction, and early warning. This indicator reflects the integration of climate change measures into national policies and planning. For SDG 15.5, the indicator mentioned is the Red List Index, which measures changes in the overall extinction risk of species over time. This indicator can be used to assess progress in reducing the degradation of natural habitats and preventing biodiversity loss.

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Source: jdsupra.com

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