US Budget Committee launches investigation into major insurance companies’ climate risk evaluation

Written by Adam Cadle

12/06/2023

The United States Senate Committee on the Budget has launched an investigation into how the US insurance industry evaluates climate-related risks, decides to invest in or underwrite fossil fuel expansion projects that drive such risks, and prices policies that insure such projects.

In letters sent to AIG, Berkshire Hathaway, Chubb, Liberty Mutual, Starr, State Farm, and Travelers, the Committee pressed the companies to disclose why and how they are still supporting the underwriting of and investment in new and expanded fossil fuel projects. Furthermore, it asked what plans they have to follow the example of global insurance counterparts, many of which have begun restricting their underwriting of fossil fuel projects; what plans they have to divest their fossil fuel-related investments; and what methodology they use to evaluate future impact on climate of their investment and underwriting decisions, among other questions.

“Any new fossil fuel expansion is incompatible with our climate goals and economic stability. By underwriting and investing in new and expanded fossil fuel projects, US insurers are helping Big Oil bring us closer to the worst runaway climate scenarios, which threaten lives, livelihoods, and the federal budget. That is why I am launching an investigation to obtain key information and internal documents showing how these companies weigh risks to the climate when considering their underwriting and investment decisions. This information is especially relevant as some of these companies begin to pull out of certain markets because they see the coming catastrophic climate risks—despite continuing to provide services to the fossil fuel industry,” Senator Whitehouse said.

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