Press Release

State Attorneys General Push Treasury Department to Address Climate Risks in Insurance Industry

Coalition urges Federal Insurance Office to recognize environmental justice implications of climate-related financial risks, improve data collection, and help guide state policies to meet climate goals.

New York, N.Y. — A coali­tion of five attor­neys gen­er­al led by New York Attor­ney Gen­er­al Leti­tia James filed com­ments yes­ter­day in response to a request for infor­ma­tion on cli­mate-relat­ed finan­cial risks by the Depart­ment of Treasury’s Fed­er­al Insur­ance Office. The com­ments high­light­ed the con­nec­tion between com­mu­ni­ties who are most affect­ed by cli­mate dis­as­ters and those with lim­it­ed access to insur­ance; it is more dif­fi­cult for those who are under­in­sured to recov­er from cli­mate dis­as­ters, mak­ing them even more vul­ner­a­ble to future cli­mate harms, which will only inten­si­fy. The AGs called on the Office to focus on how insur­ers and insur­ance prod­ucts are being made avail­able (or less so) to our most vul­ner­a­ble com­mu­ni­ties and to facil­i­tate [the] expan­sion of insur­ance prod­ucts to help these com­mu­ni­ties build finan­cial resilience to cli­mate change.” The com­ments also called on the Office to increase and stan­dard­ize the col­lec­tion of finan­cial risk data, and to make this infor­ma­tion avail­able to states through a cen­tral­ized data­base so that it can be used for policymaking. 

The AGs spelled out the two-fold respon­si­bil­i­ty of the insur­ance indus­try to address cli­mate-relat­ed finan­cial risks, not­ing the industry’s fidu­cia­ry respon­si­bil­i­ty to con­sid­er the long-term insta­bil­i­ty of invest­ing in fos­sil fuels, as well as the respon­si­bil­i­ty to pro­tect its cus­tomers who will increas­ing­ly rely on insur­ance as cli­mate-relat­ed harms inten­si­fy. The AGs not­ed that some states are already enact­ing laws and releas­ing guid­ance for the insur­ance indus­try around cli­mate risk.

Cli­mate change will con­tin­ue to harm our most vul­ner­a­ble com­mu­ni­ties,” said Bethany Davis Noll, Exec­u­tive Direc­tor of the State Ener­gy & Envi­ron­men­tal Impact Cen­ter. In show­ing the clear con­nec­tion between cli­mate and finan­cial resilience, AGs are fight­ing to ensure that there are mul­ti­ple lay­ers of pro­tec­tion at this piv­otal time.”



Back­ground — To car­ry out Exec­u­tive Order 14030 (Cli­mate-Relat­ed Finan­cial Risk), the Fed­er­al Insur­ance Office of the U.S. Depart­ment of Trea­sury issued a request for infor­ma­tion on August 31, 2021. The Office list­ed the fol­low­ing as its top cli­mate-relat­ed pri­or­i­ties: includ­ing cli­mate con­cerns in the super­vi­sion and reg­u­la­tion of insur­ers; facil­i­tat­ing the mit­i­ga­tion of cli­mate finan­cial impacts and the resilience of insur­ance mar­kets; and increas­ing engage­ment with the Office. The Office’s request for infor­ma­tion solicit­ed input on how it should best imple­ment the Exec­u­tive Order, whether its three cli­mate-relat­ed pri­or­i­ties are suf­fi­cient, how its data col­lec­tion could be improved, and how it should engage with and reg­u­late the insur­ance sec­tor, among oth­er questions.

The attor­neys gen­er­al of Con­necti­cut, Mary­land, Mass­a­chu­setts, and Ore­gon joined AG James in fil­ing yes­ter­day’s com­ments.

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About the State Ener­gy & Envi­ron­men­tal Impact Cen­ter
The State Ener­gy & Envi­ron­men­tal Impact Cen­ter at the NYU School of Law is a non-par­ti­san aca­d­e­m­ic cen­ter ded­i­cat­ed to the study and sup­port of state attor­neys gen­er­al in their work defend­ing and pro­mot­ing clean ener­gy, cli­mate and envi­ron­men­tal laws and policies.