The insurance industry is overtly aware of the impact climate change is having on its activities across the globe. The Global Federation of Insurance Associations (GFIA) therefore welcomed the opportunity to respond to a consultation by the International Association of Insurance Supervisors (IAIS) on the supervision of climate risks in the insurance sector.

In its response, GFIA raises concern about the proposed changes to the Insurance Core Principles (ICP) guidance and the supervisory material.

GFIA is especially concerned on what it considers an, ‘excessive focus on climate risk in corporate governance, remuneration and risk management’ in comparison to the wide range of other risks facing the industry.

The disproportionate focus on climate risks, for example, could potentially overshadow other critical investment, operational, and underwriting risks that can prove to be more dominant solvency concerns.