Aviva powers up renewable energy insurance as it taps into Net Zero commitments
Aviva renewable portfolio is now more than 150% of the size of the fossil fuel power generation book it exitedAviva renewable portfolio covers enough renewable energy to offset the equivalent of 24.8 million tonnes of CO2 annuallyAviva is now a UK leader in battery storage insuranceAviva is targeting a top three position as a renewable energy insurer in the London Market by the end of 2022Expert underwriting and claims team focused on the renewables market
Aviva’s renewable energy insurance business has grown to more than 150% of the size of the fossil fuel power generation book it exited in 2019. A strong presence in the onshore wind, solar power and battery storage markets has helped drive the success of this fast-evolving business.
The insurer’s renewable energy insurance proposition now globally covers enough energy to offset the equivalent of 24.8 million tonnes of carbon dioxide annually. Aviva is also a UK market leader in insuring battery storage and is targeting a top three position as a renewable energy insurer in the London Market by the end of this year.
Launched in 2019, Aviva’s integrated package of renewable energy insurance is designed specifically to support a variety of clients in a complex and growing market. It provides commercial customers with a single package of insurance to cover the whole life cycle across marine project cargo, construction and operational, third-party liability and terrorism cover.
A key part of Aviva’s renewables success has been the growth in battery storage cover, which enables the storage of electricity for future use on a utility scale, removing fluctuations or disruptions caused by weather or other conditions.
Aviva has invested in its renewable energy expertise, hiring an experienced underwriting team. Underpinning its growth is the increasing momentum as organisations and countries work towards their net-zero commitments.
A dedicated underwriting team has expanded both in knowledge and capability, with recent hires including industry-leading experts Dr Tariq Dawood from EDF in risk engineering, Melanie Carter from WTW and Caroline Reading from RSA, who are joined by Clare Such (internal appointment) in underwriting.
ESG underwriting philosophy
The rapid growth of Aviva’s renewables portfolio follows its decision to stop insuring firms directly involved in operational fossil fuel power generation.
The rationale for the move away from carbon intensive industries is outlined in Aviva’s ESG Baseline Underwriting Statement, which specifies the risks that Aviva will no longer insure:
The construction of coal-fired power stationsThe construction or operation of thermal coal minesPower generation risks that generate power from coalAny new fossil fuel mining or extraction projectsCompanies where more than 5% of their revenues are directly generated from extracting fossil fuels Offshore oil and gas rigs and platforms
Aviva’s underwriting approach to fossil fuels underpins the insurer’s view that the highest emission fuels cannot be part of a net-zero future. In supporting the transition to a low-carbon, sustainable economy, Aviva is continuing to work with customers on climate action and to provide insurance and risk management solutions to those firms that are actively taking steps to move away from high carbon fuels.
Aviva has aligned its insurance approach to the objectives of the Paris Agreement to limit global warming to 1.5 degrees, and it builds on the insurer’s role as a founding signatory of ClimateWise, the Powering Past Coal Finance Principles, and the UN-convened Net Zero Insurance Alliance.
Nick Major, MD, commercial lines, General Insurance at Aviva said, “Since launching our renewable energy portfolio we have seen strong, consistent growth. This has been driven by a number of factors including the natural growth of renewables as countries work towards achieving net zero in 2050 – particularly in the US – and growth in battery storage where we are now a UK leading insurer.”
“COP26 has refocused us all on the importance of living and working more sustainably. We have brought in industry leading expertise on risk engineering, underwriting and claims service to form a comprehensive insurance proposition. Renewables is a highly specialised marketplace so we have brought together the expertise to match. We will continue to build on our renewable proposition in 2022 and explore other options in the market such as offshore wind or green hydrogen fuel.”
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Authored by Aviva
