The US Insurance Sector and Climate-Related Financial Regulation

How the sector is delaying and diluting emerging key regulations

May, 2022

Despite a growing consensus among financial regulators that climate change poses significant risks to the insurance sector, industry associations representing the largest US insurance companies have been actively engaged in efforts to weaken and delay emerging climate-related insurance regulation at both the federal and state levels.

The primary associations engaged with these emerging policies are the American Property Casualty Insurance Association (APCIA), the American Council of Life Insurers (ACLI), the National Association of Mutual Insurance Companies (NAMIC), and the Reinsurance Association of America (RAA). These associations count among their members the top 10 insurance companies in the US by total assets in 2021 .

There has been little transparent policy engagement from these top 10 insurance companies themselves. However, lobbying reports filed with the US Congress suggest that insurance companies may be more engaged than they publicly report, with multiple company reports showing evidence of engagement on climate-related insurance policy.

Insurance industry associations analyzed have repeatedly asserted that climate change does not pose a systemic risk to the insurance industry, a claim that appears to go against the top 10 insurers’ own acknowledgements of the risks of climate change. The associations have engaged in attempts to weaken proposed regulations and delay policy implementation, including climate risk and fossil fuel exposure disclosure requirements, guidance on risk management practices, and efforts to introduce climate risk consideration into prudential and supervisory regulation.

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