Zurich Insurance becomes second firm to quit climate alliance

Zurich Insurance Group (ZURN.S) said on Wednesday it was withdrawing from the Net Zero Insurance Alliance (NZIA), becoming the second founding member to quit the climate group in less than a week.

Part of the Glasgow Financial Alliance for Net Zero (GFANZ) umbrella group of sectors pushing to decarbonize, NZIA members have faced growing pressure from campaigners to move faster in cutting emissions linked to their underwriting.

Zurich, one of Europe's biggest insurers, said after establishing a standardized methodology for tracking and disclosing emissions, it wanted "to focus our resources to support our customers with their transition".

The move by Zurich follows an announcement on Friday by Munich Re (MUVGn.DE) to leave the group because of antitrust concerns associated with alliances among companies to tackle climate change.

A spokesperson for Zurich declined to comment on whether antitrust concerns had played a part in its decision to leave, but said the decision was not in response to Munich Re.

"It is not something we decided yesterday or Friday but something we have been looking at for quite a while," a spokesman said.

"Zurich’s sustainability ambitions pre-date its membership in the NZIA. Withdrawing from the NZIA will not change the Group’s commitment to sustainability."

A spokesperson for NZIA, one of several financial industry alliances focused on cutting carbon emissions, did not immediately respond to a request for comment.

When contacted on Wednesday, Allianz and Aviva said there was no update to earlier statements affirming their commitment to NZIA. A spokesperson for AXA declined to comment.

Antitrust concerns are at the center of a growing sustainability backlash in the United States led by Republican politicians, and legal experts in the US and Europe have called on regulators to provide more assurances to companies wanting to collaborate to tackle climate change.

"The NZIA has allowed itself to be immobilized by antitrust concerns from the start," said Peter Bosshard, coordinator of the non-profit Insure Our Future campaign group.

"With Munich Re and now Zurich leaving the alliance, insurers have an even bigger direct responsibility to align their businesses with a credible 1.5C (Celsius) pathway," he said, referring to the world's goal of capping global warming at that level by mid-century.

A group of climate activists last month sent a letter to 30 insurance company CEOs including at Munich Re and Zurich, asking them to "immediately" stop underwriting new fossil fuel projects in the wake of a stark climate warning from UN scientists.