The process of unbundling treaty reinsurance to search for coal exposure is tough, yet pressure is building on the industry from investors and regulators to do more to reflect the growing risks of climate change in how they underwrite.
Five of the world’s six largest reinsurers – Swiss Re, Munich Re – have already scaled backbespoke coverage for coal projects.
“For coal we are very confident that this is something we will get transparency on, but of course it’s much more difficult than doing it for the direct and facultative business,” said Michael Menhart, head of economics, sustainability and public affairs at Munich Re.
Even if more of the major reinsurers move to stop treaty cover of coal, the impact could take some time to fully work its way through the system, as other reinsurers look to take up the slack.
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