The next step is for (re)insurers to start thinking about how they tackle, and indeed can benefit from, incorporating ESG into decision-making across their entire business, including underwriting. Read Moody’s Analytics new joint paper with the Chaucer Group: How to develop and integrate an ESG strategy.
Climate-related risks are impacting many aspects of an insurers business. One of the tools insurers use to assess the potential impacts of risks and investigate different optimization strategies is the Own Risk and Solvency Assessment (ORSA).
There can be little argument with the scale of the challenge that the world faces from climate change, and insurers are no different. In fact, insurers face a complex challenge because climate change risk affects both sides of the balance sheet, namely assets and liabilities.