Dutch Authority for the Financial Markets finds non-life insurers advancing sustainability features but lagging on impact measurement

The Dutch Authority for the Financial Markets published findings from research into sustainability characteristics in the products, underwriting processes and other activities of a large number of non-life insurers. It concludes that insurers broadly see themselves as an important link in the energy transition and are taking steps to reflect that role, but that sustainability characteristics are reported more often for retail products than for commercial offerings and that impact measurement remains a key gap. The review notes that insuring sustainability-related risks presents pricing challenges because many risks are new and uncertain, ranging from home battery fire risk to the overall risk of a hydrogen plant. Less than half of insurers measure the sustainability impact of a given product or process feature, and where impact measurement is reported, 59% of cases only track usage of a feature rather than outcomes such as CO2 savings. The AFM also reiterates that disclosure standards require sustainability claims to be correct, clear and not misleading, pointing to its guidance on sustainability claims and its ESG update stressing that claims should be concrete and well substantiated. The AFM observes that insurers are collaborating on initiatives such as sustainable claims repair and the introduction of standards to measure portfolio CO2 emissions, which could improve comparability and common definitions. It encourages continued sector initiatives and signals it will maintain supervisory attention on sustainability.