Sompo criticised for coal policy 'loophole'
Japanese insurance giant will no longer underwrite and invest in new and existing coal-fired power plants and coal mines, but climate campaigners said the policy did not go far enough
Climate campaigners have criticised Sompo for a “major loophole” in its new policy on investing in and insuring coal projects.
Japanese insurance giant Sompo last week said it will no longer underwrite and invest in new and existing coal-fired power plants and coal mines.
The group said it will also stop underwriting new policies and investments for new tar sands and energy exploration projects in the Arctic National Wildlife Refuge.
It has also become the first non-life insurer in Japan to join PCAF, an organisation that creates international standards for formulating greenhouse gas emissions.
But campaigners at Insure our Future said the new policy does not go far enough.
Sompo is the first Japanese insurer to rule out involvement in oil sands projects and exploration in the Arctic National Wildlife Refuge, the climate group said.
But they also pointed to a “major loophole” in the new policy, which gives exemptions for new and existing coal power plants and mines using technologies, such as carbon capture and storage or ammonia co-firing.
Sompo said it “may consider” insuring such projects “with a careful thought”.
More broadly, climate campaigners said Japanese insurance companies are still lagging far behind the international trend on coal insurance and the benchmark for responsible insurers.
'We urge Sompo and other Asian insurance companies to make meaningful contributions to our climate by moving away from the fossil fuel business and scaling their underwriting for renewable energy as fast as possible'
Insure Our Future
While 14 insurers have ruled out insuring new coal and committed to phasing out support for existing coal operations, none of the leading Japanese insurance companies – Tokio Marine, MS&AD and Sompo – have adopted policies to phase out coal insurance across the board, Insure our Future said.
Campaigners called on the three Japanese insurers to close the loophole to underwrite new coal power plants and mines; include a phase-out mechanism of existing coal underwriting; and stop underwriting new oil and gas projects to limit the global temperature rise to 1.5℃.
“It’s great that Sompo became the first Japanese insurer who committed to end some extreme oil and gas projects,” Yuki Tanabe, programme director at the Japan Center for a Sustainable Environment and Society, said.
“However, Sompo didn’t commit anything about phase-out timing of renewal contracts for existing coal projects. Now, Sompo needs to follow its competitors outside of Japan, and phase out all coal projects from its portfolio.”
Minyoung Shin, Asia co-ordinator of the Insure Our Future campaign, added: “The latest climate science is telling us we need to peak emissions by 2025 and that there is no room for new coal, oil and gas development in the 1.5C pathway.
“We urge Sompo and other Asian insurance companies to make meaningful contributions to our climate by moving away from the fossil fuel business and scaling their underwriting for renewable energy as fast as possible.”