Climate panel urges immediate action on carbon reduction projects

Leading industry figures have called on insurers to play a collective and proactive role in incentivising businesses towards renewable and climate-aware solutions.

IncubEx Chairman and Conduit Re Co-founder Neil Eckert says wholesale changes are needed to create a market that pushes for net-zero carbon emissions.

“There is huge opportunity to provide new risk transfer solutions as the world transitions to net zero and creates new markets for carbon,” Mr Eckert said during a climate panel at Marsh McLennan’s Rising Professionals’ Global Forum.

“We need ‘every tool in the toolbox’ – including lifestyle changes, renewable technology, carbon trading, and insurance.”

He implored insurers to play a more active role in covering risks associated with carbon offsets and called on underwriters to stop using blanket exclusions for risks they are uncomfortable with.

“Capacity from the traditional markets is not nearly enough and re/insurers and brokers will need to tap the capital markets as solutions evolve,” Mr Eckert said.

He says collaborative efforts to tackle climate issues such as acid rain and the hole in the Ozone layer prove that the markets can work together.

“Once you’ve created a market that prices carbon, that impacts the cost of fossil fuel. The change in behaviour will be driven by pure economics,” Mr Eckert said.

Carbon Cap Management Founder and CEO Michael Azlen echoed sentiments shared by the expert panel and says markets should act immediately to combat climate issues.

“Change will not be driven by morals and ESG but by supply, demand, capital and pressure as it is the most efficient way to allocate labour and capital in the market,” Mr Azlen said.

He says the global launch of carbon trading markets would “move the needle” on the issue and urged governments and companies to provide products that limit carbon emissions.

“Speak truth to power because [the climate crisis] really is an existential issue,” Mr Azlen said.

“After the final ‘no’, there comes a ‘yes’. On that ‘yes’, the future of the world depends. I’m sorry to hand you the torch but that burden is in your lap.”