Sustainable finance

Sustainable finance in the insurance and pensions sector

Sustainability is at the heart of the EU project and is key in ensuring long-term competitiveness of the EU economy and with it, the insurance and pensions sector.

Insurers and pension funds, as managers of large parts of society’s risks and important long-term investors have a particular interest in mitigating the impact of climate change and  facilitating the transition to a more sustainable and resilient economy.

By integrating sustainability considerations from an environmental, social and governance (ESG) perspective into the regulatory and supervisory framework for insurers, reinsurers, insurance distributors and pension providers, EIOPA contributes to the European Commission's Sustainable Finance Action Plan and to the ‘Green Deal’.

EIOPA has been implementing an ambitious strategic plan on sustainability and climate change with the following objectives: 

  • Insurers should manage and mitigate ESG risks through their underwriting activity;
  • Insurers and pension funds should reflect policyholder and pension scheme member preferences for sustainable investments, where relevant; 
  • Insurers and pension funds should adopt a sustainable approach in their investments based on principles of stewardship

EIOPA’s projects in sustainable finance

EIOPA has been carrying out several projects to establish its policy on sustainable finance and to develop tools and methods for ESG risk analysis, with a view to embed ESG risk analysis in regulation as well as in supervision.

EIOPA publically consults and organizes regular Roundtables on Sustainable Finance, to discuss its proposals with participants from EIOPA’s Stakeholder Groups, the European Commission, representatives of the insurance and pensions, asset management and rating industries, and representatives of consumers associations and civil society.

At its latest Roundtable on Sustainable finance, EIOPA stressed the importance for insurers and pension funds to manage sustainability risks as part of their risk management, as well as to contribute to reducing risks to sustainability for society.

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EIOPA is a member of the Network for Greening the Financial System and of the Sustainable Insurance Forum, as well as the European Commission's Sustainable Finance Platform for the taxonomy on sustainable economic activities.

In addition, EIOPA is aiming to improve its own environmental performance as an institution and to lower its impact on the environment. EIOPA has registered to the EMAS (Eco Management and Audit Scheme).

EIOPA’s mandate on sustainable finance, following the review of its founding regulation, is to:

  • take into account sustainable business models and integration of ESG-related factors in the areas of its competence, 
  • develop criteria for identifying systemic risks and an adequate stress-testing regime, including potential environmental-related systemic risk, 
  • put in place a monitoring system, and 
  • develop common methodologies for union-wide assessment of resilience of financial undertakings taking into account risks stemming from adverse environmental developments and of the effect of environmental risks on the financial stability of financial institutions.

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Taxonomy

Taxonomy-related product disclosures: public event on the European Supervisory Authorities consultation

The European Supervisory Authorities (ESAs) are organising an online public event on 29 April, from 13:00-17:30 During this event the ESAs will present their proposals and open a dialogue with stakeholders on draft Regulatory Technical Standards (RTS) on the content and presentation of product...
Taxonomy | Sustainability

ESAs consult on Taxonomy–related product disclosures

The three European Supervisory Authorities (EBA, EIOPA and ESMA – ESAs) have today issued a Consultation Paper seeking input on draft Regulatory Technical Standards (RTS) regarding disclosures of financial products investing in economic activities that contribute to an environmental investment...
Taxonomy | Sustainability

ESAs consult on Taxonomy–related product disclosures

The three European Supervisory Authorities (EBA, EIOPA and ESMA – ESAs) have today issued a Consultation Paper seeking input on draft Regulatory Technical Standards (RTS) regarding disclosures of financial products investing in economic activities that contribute to an environmental investment...
Reporting | Sustainability | Disclosure

Joint consultation on taxonomy-related sustainability disclosures

The joint consultation launched by the three European Supervisory Authorities (EBA, EIOPA and ESMA – ESAs) is seeking input on draft Regulatory Technical Standards (RTS) regarding disclosures of financial products investing in economic activities that contribute to an environmental investment...
Reporting | Sustainability | Disclosure

Joint consultation on taxonomy-related sustainability disclosures

The joint consultation launched by the three European Supervisory Authorities (EBA, EIOPA and ESMA – ESAs) is seeking input on draft Regulatory Technical Standards (RTS) regarding disclosures of financial products investing in economic activities that contribute to an environmental investment...
Sustainability | Gabriel Bernardino

Moving to green: how insurance is the risk manager of society

Why does EIOPA think it is important for insurers to take into account the risks of climate change now and focus on this part of the strategic agenda of the European Union, rather than other challenges? “Of course we prioritize all areas, but I think arguably all issues related to climate change...
Reporting | Sustainability

Insurers’ sustainability reporting: EIOPA’ technical advice on key performance indicators under article 8 of the taxonomy regulation

The main objective of the Taxonomy Regulation is to set out relevant criteria for determining whether an economic activity qualifies as environmentally sustainable, in particular, in order to address market failures that hamper the identification of such economic activities and therewith,...
Reporting | Sustainability

EIOPA advises on insurers’ key performance indicators on sustainability for non-financial reporting

The European Insurance and Occupational Pensions Authority (EIOPA) submitted its advice to the European Commission on the mandatory sustainability disclosure of insurers’ and reinsurers’ key performance indicators within the scope of the Non-Financial Reporting Directive. Relevant, comparable and...
Sustainability

Joint ESA Supervisory Statement on the application of the Sustainable Finance Disclosure Regulation

This Supervisory Statement of the European Supervisory Authorities (ESAs) seeks to mitigate the risk of divergent application of Regulation (EU) 2019/2088 on sustainability-related disclosures in the financial services sector (hereinafter referred to as “SFDR”) within the period from 10 March 2021...
Sustainability | Disclosure

ESAs issue recommendations on the application of the Regulation on sustainability-related disclosures

The three European Supervisory Authorities (EBA, EIOPA and ESMA – ESAs) have today published a joint supervisory statement on the effective and consistent application and national supervision of the Regulation on sustainability-related disclosures in the financial services sector (SFDR). The...
Sustainability | Disclosure

ESAs issue recommendations on the application of the Regulation on sustainability-related disclosures

The three European Supervisory Authorities (EBA, EIOPA and ESMA – ESAs) have today published a joint supervisory statement on the effective and consistent application and national supervision of the Regulation on sustainability-related disclosures in the financial services sector (SFDR). The...
Protection gap | Sustainability

The opportunity to design real catastrophe insurance is now

Set up in 2011, the European Insurance and Occupational Pensions Authority (EIOPA) is the European body responsible for insurance and occupational pensions. The EIOPA’s first chairman, Gabriel Bernardino, is retiring next month, and BRINK spoke to him about the need for shared resilience and public...
Protection gap | Sustainability

The opportunity to design real catastrophe insurance is now

Set up in 2011, the European Insurance and Occupational Pensions Authority (EIOPA) is the European body responsible for insurance and occupational pensions. The EIOPA’s first chairman, Gabriel Bernardino, is retiring next month, and BRINK spoke to him about the need for shared resilience and public...
Shared resilience solutions | Protection gap | Sustainability | COVID-19

EIOPA staff paper on measures to improve the insurability of business interruption risk in light of pandemics

In this paper, EIOPA analyses options relating to prevention measures to reduce losses, capital markets risk transfer, and multi-peril solutions for systemic risk. It also addresses the general challenges related to modelling and triggers for claims in the context of pandemics. EIOPA invites all...
Shared resilience solutions | Protection gap | Sustainability | COVID-19

EIOPA staff paper on measures to improve the insurability of business interruption risk in light of pandemics

In this paper, EIOPA analyses options relating to prevention measures to reduce losses, capital markets risk transfer, and multi-peril solutions for systemic risk. It also addresses the general challenges related to modelling and triggers for claims in the context of pandemics. EIOPA invites all...
Shared resilience solutions | Protection gap | Sustainability | COVID-19

EIOPA staff paper on measures to improve the insurability of business interruption risk in light of pandemics

In this paper, EIOPA analyses options relating to prevention measures to reduce losses, capital markets risk transfer, and multi-peril solutions for systemic risk. It also addresses the general challenges related to modelling and triggers for claims in the context of pandemics. EIOPA invites all...
Shared resilience solutions | Protection gap | Sustainability | COVID-19

EIOPA addresses measures to improve the insurability of business interruption risk in light of pandemics

The European Insurance and Occupational Pensions Authority (EIOPA) published today its staff paper on measures to improve the insurability of business interruption in light of pandemics. Building on the Issues paper on shared resilience solutions for pandemics published in July, EIOPA analyses...
Shared resilience solutions | Protection gap | Sustainability | COVID-19

EIOPA addresses measures to improve the insurability of business interruption risk in light of pandemics

The European Insurance and Occupational Pensions Authority (EIOPA) published today its staff paper on measures to improve the insurability of business interruption in light of pandemics. Building on the Issues paper on shared resilience solutions for pandemics published in July, EIOPA analyses...
Shared resilience solutions | Protection gap | Sustainability | COVID-19

EIOPA addresses measures to improve the insurability of business interruption risk in light of pandemics

The European Insurance and Occupational Pensions Authority (EIOPA) published today its staff paper on measures to improve the insurability of business interruption in light of pandemics. Building on the Issues paper on shared resilience solutions for pandemics published in July, EIOPA analyses...
Sustainability | Disclosure

The three European Supervisory Authorities publish Final Report and draft RTS on disclosures under SFDR

The Joint Committee of the three European Supervisory Authorities (EBA, EIOPA and ESMA – ESAs) delivered today to the European Commission (EC) the Final Report , including the draft Regulatory Technical Standards (RTS), on the content, methodologies and presentation of disclosures under the EU...
Sustainability | Disclosure

The three European Supervisory Authorities publish Final Report and draft RTS on disclosures under SFDR

The Joint Committee of the three European Supervisory Authorities (EBA, EIOPA and ESMA – ESAs) delivered today to the European Commission (EC) the Final Report , including the draft Regulatory Technical Standards (RTS), on the content, methodologies and presentation of disclosures under the EU...
Sustainability | Disclosure

Final Report on draft Regulatory Technical Standards

The European Supervisory Authorities (ESAs) have developed through the Joint Committee (JC) draft Regulatory Technical Standards (RTS) with regard to the content, methodologies and presentation of sustainability-related disclosures under empowerments Articles 2a, 4(6) and (7), 8(3), 9(5), 10(2) and...
Sustainability | Disclosure

Final Report on draft Regulatory Technical Standards

The European Supervisory Authorities (ESAs) have developed through the Joint Committee (JC) draft Regulatory Technical Standards (RTS) with regard to the content, methodologies and presentation of sustainability-related disclosures under empowerments Articles 2a, 4(6) and (7), 8(3), 9(5), 10(2) and...
Risk assessment | Stress test

Methodological principles of insurance stress testing - liquidity component

The paper sets out methodological principles that can be used to design bottom-up stress test exercises to assess the vulnerability of insurers to liquidity shocks. The conclusions are based on the current understanding and knowledge of the liquidity risk in the insurance industry.