Ping An-led report examines impact of climate change on insurance

Ping An Insurance (Group) Company of China, Ltd, in collaboration with several institutions, has published a report entitled “Climate Change Adaptation and Disaster Risk Management: Current Practices and Future Prospects for the Insurance Industry”.

This report – prepared in collaboration with Southern University of Science and Technology, Tsinghua University, Risk Lighthouse International and Ernst & Young (China) Enterprise Consulting Co – examines the impact of climate change on the insurance industry.

Impact of the increasing frequency of natural disasters

The report highlighted the challenges posed by the increasing frequency of natural disasters linked to long-term climate change, stressing the growing financial burden on insurance companies due to increased compensation claims and payout obligations resulting from these catastrophic events.

The paper examines how insurers in China and globally are responding to these challenges and provides policy recommendations to improve resilience to climate risks.

It also provided insights into Ping An’s sustainable development efforts and strategies to address climate change, and presented a multi-faceted analysis of how the insurance industry can transform these challenges into potential growth opportunities.

Richard Sheng, Board Secretary and Brand Director at Ping An, pointed out the increasing frequency of extreme weather events worldwide.

Ping An’s sustainability initiatives

Sheng said Ping An aims to lead China’s insurance industry in combating climate change and supporting sustainable development.

Ping An actively promotes sustainable development through its business operations. By the end of 2023, the company recorded green insurance premium income of RMB 37.3 billion, an increase of nearly 49% year-on-year. Its green loan balance reached RMB 146.3 billion, an increase of 25.7% year-on-year, while green investments in insurance funds totaled RMB 128.6 billion, an increase of 19% year-on-year.

Looking ahead, Ping An announced that the company will continue to focus on the sustainable development of the insurance industry. The company intends to develop and expand products related to green insurance and climate risk insurance. In cooperation with government authorities, the insurance industry in general, public institutions and research organizations, the company aims to strengthen society’s resilience to climate-related risks.