In a further sign of the growing importance of the Environmental, Social and Governance (ESG) risk agenda for insurers, Beazley has confirmed this week that it aims to establish a new ESG consortium at Lloyd’s.
The aim is to begin underwriting from 1st January 2022, subject to approval.
As a next stage, the intention is to create a Syndicate in a Box that would provide follow capacity and an opportunity for third-party capital providers to place capital into an ESG insurance facility. This too would be subject to regulatory approval.
Beazley said that the thinking behind the consortium is that as insurers its role is to support clients in becoming more resilient and sustainable businesses, which increasingly means helping to proactively align business practices with good environmental, social, cultural and governance principles:
“As an insurance company we too need to demonstrate how we’re supporting the shift towards a greener economy, as well as fairer societies and cultural inclusion and equality; development of the consortium is evidence of this in action.”
“Our recently published responsible business strategy explains how we are doing this and is helping to drive improvements in how we work as we continue to build ESG considerations into our investment and underwriting, and in how we’re supporting clients in making the changes they need to make.”
In a statement Beazley added: “On the underwriting side, we believe firms that consider ESG principles are likely to be better risks long term and we anticipate ESG becoming a more significant underwriting factor over the next few years.”
“We are currently in the process of building this new insurance solution, which will (subject to regulatory approval) be able to provide new capacity for clients that perform highly against established ESG metrics, and for risks that meet the threshold to be given access to high quality, A-rated capacity. We plan that internal assessments by our Responsible Business team and external ESG scoring specialists, will be used to evaluate the performance of clients against a number of pre-defined ESG metrics.”
The link to Beazley’s report can be found here: