March 12, 2021 Read More →

French insurance firm Axa drops RWE over coal

Bloomberg:

Axa SA, France’s biggest insurer, is dropping German energy giant RWE AG as a client in a decision that highlights how taboo the coal business has become.

Not even an appeal from RWE Chief Executive Officer Rolf Martin Schmitz to his counterpart at Axa, Thomas Buberl, was enough to persuade the insurer to retreat from its conviction that the utility’s coal operations are too large and it’s moving too slowly to shrink its carbon footprint, according to two people with knowledge of the matter who declined to be identified.

“By turning away one of Europe’s biggest utilities because they are too dependent on coal, Axa has set an important precedent for itself and other insurers,” said Peter Bosshard, finance program director at environmental nonprofit the Sunrise Project, adding that RWE must be an account worth millions of dollars a year in insurance.

Rejecting customers amid Europe’s deepest recession since World War II, shows how, for some companies, climate change has gone from a talking point on panel discussions to a key factor in day-to-day business decisions. Insurers like Axa carry a particularly big stick, since there are only a handful big enough to cover global customers.

Axa became the first insurer to impose coal-related underwriting restrictions when it made the choice in 2017 and the company stopped providing insurance for coal mines and plants at the end of 2020 after a two-year grace period expired, people familiar with the matter said.

With RWE, one of Europe’s biggest coal mine operators and largest emitters of greenhouse gases, Axa is going even further. The French company will sever all its ties with the utility by the end of next year, even refusing to insure RWE’s renewable projects, the people said.

[Alastair Marsh and Vanessa Dezem]

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