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Lloyd’s launches consultation on insuring the transition to a lower-carbon economy

23 Nov 2023

Lloyd’s, the world’s leading marketplace for insurance and reinsurance, has today launched a consultation on its roadmap for insuring the transition. The consultation sets out Lloyd’s proposed approach for the next three years across all areas of sustainability for the market, including underwriting, investments, exposure management and capital and reserving. 

The roadmap has been designed to support market participants in evolving and embedding their own sustainability strategies, including navigating evolving regulatory reporting requirements. It also aims to provide greater clarity to all stakeholders on how Lloyd’s will support customers as they respond to a volatile macro-environment, while maintaining decarbonisation and transition progress to support global ambitions to achieve net zero.  

The document sets out planned oversight processes and regulatory expectations on climate-related risk management, capital and reserving as well as transition planning. It seeks to provide short-term actionable steps that can be taken, focusing on the areas that matter. The plan will be developed and iterated in response to consultation feedback, and for future years to ensure it remains in line with government policy and regulatory requirements. 

“We hope that in setting out this consultation, the market will have greater clarity on the approach the Corporation is planning to implement, to support our customers in facing the challenges of transitioning to lower carbon business models. Our aim is to give our market participants greater confidence in setting, embedding and operationalising their own individual climate strategies, through the transition and beyond.”
Lloyd’s CEO, John Neal

Acknowledging that effectively planning and executing on transition plans is one of the greatest challenges businesses will face in the coming years, the details provided in the consultation can be used by brokers in their discussions with clients, as well as managing agents formulating their own transition plans, as and when is appropriate for each business.

Lloyd’s is further supporting managing agents in this area by providing guidance on new product areas, publishing thematic reviews on climate change and committing to develop a proof-of-concept for an emissions accounting measurement framework.

The consultation also includes useful resources on managing the transition risk of managing agents’ investment portfolios. In March this year, Lloyd’s launched the Private Impact Fund, for sustainability-focused assets, across themes of Climate Mitigation and Adaptation.

For further information on Lloyd’s sustainability strategy, Lloyd’s latest sustainability report, outlining the progress made in 2022 against the United Nations Sustainable Development Goals (UN SDGs) is available on our website. The report also includes supplementary reporting for Taskforce for Climate-related Financial Disclosures (TCFD), ClimateWise and the United Nations Global Comact reporting framework.

Notes to Editors

  1. The consultation was designed with managing agents, brokers, and insurance associations. It will be open for two months starting 23 November 2023 until the 31 January 2024.
  2. Lloyd’s market participants will continue to be responsible for setting their own business strategies and work on the most appropriate sustainability strategy for their business and their customers.
  3. We encourage all participants to share views and provide constructive feedback on how Lloyd’s can support in specific areas.
  4. You can read more about Lloyd’s sustainability work here.
  5. Further details on the UN SDGs can be found here

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About Lloyd’s

Lloyd’s is the world’s leading marketplace for insurance and (re)insurance. Through the collective intelligence and expertise of the market’s underwriters and brokers, we’re sharing risk to create a braver world.

The Lloyd’s market offers the resources, capability, and insight to develop new and innovative products for customers in any industry, on any scale, in more than 200 territories.

We’re made up of more than 50 leading insurance companies, over 380 registered Lloyd’s brokers and a global network of over 4,000 local coverholders. Behind the Lloyd’s market is the Corporation: an independent organisation and regulator working to maintain the market's successful reputation and operation.

We’re working to build solutions for the most current and prevalent threats. As Chair of the Insurance Task Force for HM King Charles III’s Sustainable Markets Initiative, Lloyd’s is bringing the industry together to insure the transition to net zero. Our research community is pooling expertise from across the industry to provide cutting edge insight on systemic risks from climate change to cyber security.

And through our digital-led strategy, The Future at Lloyd’s, we’re making it easier and cheaper to place, price and process cover in the Lloyd’s market.