PR98729

ZURICH, Nov. 10, 2022 /PRNewswire=KYODO JBN/--

Amid growing stakeholder expectations for businesses to have more social

impact, a new Geneva Association report, The Role of Insurance in Promoting

Social Sustainability, highlights insurance's abundant, inherent social benefit

in providing financial stability and peace of mind to people and businesses.

The Geneva Association estimates that insurers contribute USD 5–5.5 trillion

per year to global financial resilience through insurance claims and benefit

payouts.

To further advance social sustainability, the report advises insurers to hone

their impact underwriting and investing activities, as well as due diligence on

risks linked to their clients, investees and operations, from human rights

violations to algorithmic bias.

The Geneva Association report puts forward an innovative framework for insurers

to assess their 'social footprint', inspired by the Greenhouse Gas Protocol's

approach to carbon emissions disclosure:

- Scope 1 is an insurer's social impacts on its employees.

- Scope 2 is the insurer's impacts on communities.

- Scope 3 – by far the most important – is the insurer's social impacts across

the value chain, from risk-taking and servicing to investing – upstream

(value-chain partners) and downstream (customers and investees).

Jad Ariss, Managing Director of The Geneva Association, said: "Clearly

businesses need to do more to promote social sustainability, particularly in

light of the repercussions of the pandemic and Russia-Ukraine war. Insurers

have always been – and will continue to be – at the forefront of this agenda;

the very essence of the insurance business is protecting society, providing

financial security and peace of mind, and supporting recovery from shocks. That

said, insurers can build out their impact in this space and need to address the

absence of suitable metrics. We hope our report serves as a guide."

The author of the report, Kai-Uwe Schanz, Deputy Managing Director and Director

of Socio-economic Resilience at The Geneva Association, said: "The report

recommends insurers to adopt a three-tier approach to managing social

sustainability. First, maximise the inherently positive social impacts of

insurance; second, protect those benefits by carefully mitigating potentially

negative impacts; and, third, explore the scope for additional, commercially

viable social benefits. Based on this approach, we believe that insurers can

further enhance their role in providing socially relevant products and working

to close protection gaps. This is more important than ever as the transition to

a net-zero economy needs to be socially just and inclusive."

The Geneva Association is the only global association of insurance companies;

its members are insurance and reinsurance CEOs. Based on rigorous research

conducted in collaboration with its members, academic institutions and

multilateral organisations, The Geneva Association investigates key risk areas

that are likely to impact the insurance industry, develops recommendations and

provides a platform for stakeholders to discuss them. In total, the companies

of Geneva Association members are headquartered in 26 countries around the

world; manage USD 21 trillion in assets; employ more than 2.5 million people;

and protect 2.6 billion people.

https://www.genevaassociation.org/press-releases/insurers-rising-to-social-sustainability-challenges

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Source: The Geneva Association