New York City comptroller tells insurers to ditch coal

Written by Adam Cadle

28/04/2020

New York City comptroller Scott Stringer has called on AIG, Berkshire Hathaway and Liberty Mutual to end all business with the coal industry – including ceasing to underwrite coal projects and divesting from coal companies – on behalf of the city’s pension funds.

Stringer told the insurers in three individual letters that continued involvement in the coal sector was “simply incompatible both with your obligation to protect your clients from harm… and your responsibility to protect and create long-term shareholder value.”

Berkshire Hathaway, AIG, and Liberty Mutual Insurance held more than $6.7bn combined in coal investments as of 2017. Liberty Mutual has committed to phasing out future investments in coal, though has not moved to divest its existing portfolio of coal investments.

The letters point to divestment by BlackRock (divesting $1.8trn in actively managed funds from any firm generating more than a quarter of revenues from thermal coal) and Goldman Sachs (ruling out direct finance for new or expanding thermal coal mines and coal-fired power plant projects worldwide, as well as direct finance for new Arctic oil exploration and production) as examples of the direction of travel on coal. To date 19 insurance and reinsurance companies have issued policies limiting their underwriting of coal and as many as 35 insurers have committed to various forms of divestment from coal, including Swiss Re, Zurich, Chubb, and AXIS Capital.

The three New York City pension funds, the New York City Employees’ Retirement System, Teachers Retirement System of the City of New York and New York City Board of Education Retirement System, have already divested from coal themselves.

New York is the third major city to call on insurers to ditch coal, following similar actions by Paros and San Francisco in 2018.

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