NAIC not anticipating developing regulatory policy on ESG for insurers

Written by Adam Cadle

22/02/2024

The NAIC does not anticipate developing regulatory policy to require or prohibit insurance companies from adopting ESG policies that govern insurers’ underwriting, investing, or other business decisions, its members have said in a statement.

However, it said it has “extensive work underway on climate risk, race and insurance, corporate governance, and other related factors to the extent they directly pertain to our responsibility to protect policyholders and supervise the financial health of insurers”.

The NAIC is encouraging insurers, regulatory bodies, standard setters, and policymakers to consider the reliability of metrics and the impact of ESG policies on the financial condition of insurers and the availability and affordability of insurance products and services, if adopting such policies.

Furthermore, the NAIC is inviting and encouraging legislators, policymakers, and stakeholders to contact state insurance regulators when considering ESG-related legislation or executive action to discuss the potential impact of proposals on the solvency and financial stability of the insurance sector.

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