Sustainable finance

Sustainability issues pose risks and opportunities to the insurance and pension sectors

Climate change, environmental and social risks can have an important impact on human, social and economic life. If not managed properly, they can pose material risks to the assets and liabilities of insurers and pension providers.

At the same time, the insurance and pensions sector can play an important role in the mitigation and adaptation to climate change or sustainability risks, through their investments, products and services. Given their role as society’s risk managers and important long-term investors, insurers and pension funds have a unique opportunity and responsibility to address sustainability-related challenges and facilitate the transition to a more sustainable and resilient economy.

What are EIOPA’s main areas of activity?

Through its work on sustainable finance, EIOPA aims to ensure that (re)insurers and occupational pension funds integrate sustainability risks in their risk management to protect consumers and secure financial stability. In doing so, EIOPA aims to ensure that insurers and pension funds can continue to offer relevant and affordable risk management solutions against natural catastrophes or old age poverty.

EIOPA’s activities on sustainable finance reflect the need for global action to enable decisive progress on the transition to a more sustainable economy. Sustainable finance is a strategic priority area in EIOPA’s work programme 2022-2024, and the Commission’s Strategy for financing the transition to a sustainable economy encapsulates work by EIOPA in delivering on the Green Deal.

In line with EIOPA’s founding regulation and sectoral regulation on insurance and occupation pensions,  EIOPA’s 7 key areas of activity on sustainable finance for 2022-2024 are the following:

  1. Integrate ESG risks in the prudential framework of insurers and pension funds
  2. Consolidate the macro/microprudential risk assessment of ESG risks
  3. Promote sustainability disclosures and a sustainable conduct of business framework
  4. Support supervision of ESG risks and supervisory convergence in the EU
  5. Address protection gaps
  6. Promote the use of open source modelling and data in relation to climate change risks
  7. Contribute to international convergence for the assessment and management of sustainability risks

Download the sustainable finance activities 2022-2024

How to stay informed about our work?

EIOPA organizes regular Roundtables on Sustainable Finance to discuss past and upcoming work and the vital role that insurance and pensions play in strengthening society’s resilience to sustainability risks.

Our roundtables gather participants from Stakeholder Groups, the European Commission, representatives of the insurance and pensions, asset management and rating industries, and representatives of consumers associations and civil society.

Roundtables are public events and registrations are open to everyone.

Check  the events calendar 

Cooperation on sustainable finance

Climate change does not stop at borders. As a member of the Network for Greening the Financial System (NGFS), the Sustainable Insurance Forum (SIF) and the International Association of Insurance Supervisors (IAIS), EIOPA cooperates with European and international supervisory and standard-setting bodies to establish convergent supervisory practices for  sustainability risks in the financial services sector.

EIOPA’s deliverables on sustainable finance

Find out more about our work in this area. Here below search for news, reports, consultations, as well as speeches, interviews and events in the area of sustainable finance.

Risk assessment | Sustainability

Sensitivity analysis of climate-change related transition risks

The report explores current holdings of corporate bonds and equity that can be related to key climate-policy relevant sectors such as fossil fuel extraction, carbon‐intensive industries, vehicle production and the power sector. It also quantifies potential climate-change related transition risks...
Risk assessment | Sustainability

Sensitivity analysis of climate-change related transition risks

The report explores current holdings of corporate bonds and equity that can be related to key climate-policy relevant sectors such as fossil fuel extraction, carbon‐intensive industries, vehicle production and the power sector. It also quantifies potential climate-change related transition risks...
Sustainability

Sensitivity analysis of climate-change related transition risks: EIOPA’s first assessment

The European Insurance and Occupational Pensions Authority (EIOPA) published today its sensitivity analysis of climate-change related transition risks in the investment portfolio of European insurers. The report explores current holdings of corporate bonds and equity that can be related to key...
Sustainability | Impact underwriting

Ensuring the availability and affordability of insurance in light of climate change: Discussion paper on non-life underwriting and pricing

Today, the European Insurance and Occupational Pensions Authority (EIOPA) has published a discussion paper on non-life underwriting and pricing in light of climate change . The discussion paper highlights challenges associated with current non-life underwriting practices and options to ensure the...
Sustainability | Impact underwriting

Ensuring the availability and affordability of insurance in light of climate change: Discussion paper on non-life underwriting and pricing

Today, the European Insurance and Occupational Pensions Authority (EIOPA) has published a discussion paper on non-life underwriting and pricing in light of climate change . The discussion paper highlights challenges associated with current non-life underwriting practices and options to ensure the...
Sustainability | Impact underwriting

Discussion paper on non-life underwriting and pricing in light of climate change

The discussion paper highlighted challenges associated with current non-life underwriting practices and options to ensure the availability and affordability of insurance products, in the context of climate change. The discussion paper built on work stemming from the Opinion on sustainability within...
Sustainability | Impact underwriting

Discussion paper on non-life underwriting and pricing in light of climate change

The discussion paper highlighted challenges associated with current non-life underwriting practices and options to ensure the availability and affordability of insurance products, in the context of climate change. The discussion paper built on work stemming from the Opinion on sustainability within...
Protection gap | Sustainability

The pilot dashboard on insurance protection gap for natural catastrophes

This is the first pilot dashboard which depicts the insurance protection gap for natural catastrophes. The aim is to represent the drivers of a climate-related insurance protection gap in order to identify measures that will help in decreasing society’s losses in the event of natural catastrophes...
Protection gap | Sustainability

The pilot dashboard on insurance protection gap for natural catastrophes

This is the first pilot dashboard which depicts the insurance protection gap for natural catastrophes. The aim is to represent the drivers of a climate-related insurance protection gap in order to identify measures that will help in decreasing society’s losses in the event of natural catastrophes...
Sustainability

EIOPA’s pilot dashboard addresses the natural catastrophe protection gap

Today, the European Insurance and Occupational Pensions Authority (EIOPA) launched its first pilot dashboard , which depicts the insurance protection gap for natural catastrophes. The aim is to represent the drivers of a climate-related insurance protection gap in order to identify measures that...
Solvency II | Solvency requirements | Sustainability

Discussion Paper: Methodology on potential inclusion of climate change in the nat cat standard formula

This Discussion Paper is a follow-up to EIOPA’s Opinion on Sustainability within Solvency II (EIOPA, 2019). The opinion highlighted that further work is needed to investigate whether additional climate change-related perils such as droughts and wildfire could be better captured in the Solvency II...
Solvency II | Solvency requirements | Sustainability

Discussion Paper: Methodology on potential inclusion of climate change in the nat cat standard formula

This Discussion Paper is a follow-up to EIOPA’s Opinion on Sustainability within Solvency II (EIOPA, 2019). The opinion highlighted that further work is needed to investigate whether additional climate change-related perils such as droughts and wildfire could be better captured in the Solvency II...
Solvency II | Sustainability

EIOPA launches discussion paper on a methodology for integrating climate change in the standard formula

Today, the European Insurance and Occupational Pensions Authority (EIOPA) published a discussion paper on a methodology for the potential inclusion of climate change in the Solvency II standard formula when calculating natural catastrophe underwriting risk. This discussion paper is a follow-up to...
Taxonomy | Sustainability | Disclosure

Consultation on EIOPA advice regarding Article 8 of the Taxonomy Regulation

This consultation refers to the relevant ratios to be mandatorily disclosed by insurers and reinsurers falling within the scope of the Non-Financial Reporting Directive as well as on the methodologies to build those ratios. In this consultation, EIOPA considers whether the mandatory ratios of non-...
Taxonomy | Sustainability | Disclosure

Consultation on EIOPA advice regarding Article 8 of the Taxonomy Regulation

This consultation refers to the relevant ratios to be mandatorily disclosed by insurers and reinsurers falling within the scope of the Non-Financial Reporting Directive as well as on the methodologies to build those ratios. In this consultation, EIOPA considers whether the mandatory ratios of non-...
Taxonomy | Sustainability | Disclosure

Consultation on EIOPA advice regarding Article 8 of the Taxonomy Regulation

This consultation refers to the relevant ratios to be mandatorily disclosed by insurers and reinsurers falling within the scope of the Non-Financial Reporting Directive as well as on the methodologies to build those ratios. In this consultation, EIOPA considers whether the mandatory ratios of non-...
Sustainability | Disclosure

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

The European Insurance and Occupational Pensions Authority (EIOPA) started today a consultation on the relevant ratios to be mandatorily disclosed by insurers and reinsurers falling within the scope of the Non-Financial Reporting Directive as well as on the methodologies to build those ratios...
Sustainability | Disclosure

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

The European Insurance and Occupational Pensions Authority (EIOPA) started today a consultation on the relevant ratios to be mandatorily disclosed by insurers and reinsurers falling within the scope of the Non-Financial Reporting Directive as well as on the methodologies to build those ratios...
Sustainability

4th Sustainable Finance Roundtable

EIOPA’s fourth roundtable on sustainable finance took place on 16 December 2020 , from 09:00 to 17:00. It covered recent and upcoming deliverables of EIOPA on integrating environmental, social and governance risk assessment in the regulatory and supervisory framework for insurance and pensions ...
Sustainability

Letter from the European Commission to the ESAs on the application of Regulation (EU) 2019/2088 on the sustainability-related disclosures in the financial services sector

Letter from the European Commission regarding the application of Regulation (EU) 2019/2088 on the sustainability related disclosures in the financial services sector and related technical standards.
Solvency II | Sustainability

EIOPA consults on the supervision of the use of climate change scenarios in ORSA

Today, the European Insurance and Occupational Pensions Authority (EIOPA) published a consultation on the use of climate change risk scenarios in the Own Risk and Solvency Assessment (ORSA) in the form of a draft supervisory Opinion. In EIOPA’s view, it is essential to foster a forward-looking...
ORSA | Scenario analysis | Sustainability

Consultation on the draft Opinion on the supervision of the use of climate change risk scenarios in ORSA

The consultation is a follow-up to last year’s Opinion on Sustainability within Solvency II , which recommended that (re)insurers consider climate risks beyond the one-year time horizon through the system of governance, risk-management system and the Own Risk and Solvency Assessment (ORSA). The...
ORSA | Scenario analysis | Sustainability

Consultation on the draft Opinion on the supervision of the use of climate change risk scenarios in ORSA

The consultation is a follow-up to last year’s Opinion on Sustainability within Solvency II , which recommended that (re)insurers consider climate risks beyond the one-year time horizon through the system of governance, risk-management system and the Own Risk and Solvency Assessment (ORSA). The...
ORSA | Scenario analysis | Sustainability

Consultation on the draft Opinion on the supervision of the use of climate change risk scenarios in ORSA

The consultation is a follow-up to last year’s Opinion on Sustainability within Solvency II , which recommended that (re)insurers consider climate risks beyond the one-year time horizon through the system of governance, risk-management system and the Own Risk and Solvency Assessment (ORSA). The...
Risk assessment | Supervision

EIOPA launches consultation on Supervisory Statement on the use of risk mitigation techniques by insurance and reinsurance undertakings

Today, the European Insurance and Occupational Pension Authority (EIOPA) launched a consultation on EIOPA’s Supervisory Statement on the use of risk mitigation techniques by insurance and reinsurance undertakings. The aim of this statement is to promote supervisory convergence on the assessment of...
COVID-19 | Risk assessment

EU financial regulators assess risks to the financial sector after the outbreak of COVID-19 and call for enhanced cooperation

The three European Supervisory Authorities (EBA, EIOPA and ESMA - ESAs) have issued their first joint risk assessment Report of the financial sector since the outbreak of the COVID-19 pandemic. The Report highlights how the pandemic has led to further amplified profitability concerns across the...