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At least $10tn of insurance cover needed to reach net zero, report says

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By illuminem briefings

· 2 min read

iIlluminem summarizes for you the essential news of the day. Read the full piece on the Financial Times or enjoy below:

🗞️ Driving the news: A new report by Howden and Boston Consulting Group reveals that at least $10 trillion of insurance cover will be needed to support the $19 trillion investment required for the transition to net zero by 2030, highlighting unprecedented structural pressures on the insurance sector

🔭 The context: The insurance sector's role is crucial in underwriting the risks associated with new green technologies and large-scale infrastructure projects, such as offshore wind and solar farms
Insurers are working with green energy groups to mitigate risks, but face challenges due to the lack of historical data on these innovative technologies

🌍 Why it matters for the planet: Adequate insurance coverage is essential for the successful deployment of renewable energy projects and other green technologies, which are vital for achieving global net-zero targets and combating climate change

⏭️ What's next: Despite pressures, there is an anticipated need for continued insurance in fossil fuel projects alongside green investments
• Insurers must balance caution with innovation to provide necessary coverage without historical loss data

💬 One quote: "We are going to be having this energy transition globally, at pace and scale, all at the same time,” said Rowan Douglas, Howden’s climate team CEO

📈 One stat: At least $10 trillion of new insurance cover is needed between 2023 and 2030 for the energy, road transport, and building sectors

Click for more news covering the latest on sustainable finance and net zero

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