Regulatory Alerts2026-04-02
Good sustainability initiatives among property and casualty insurers
The Dutch Authority for the Financial Markets (AFM) released research on property and casualty insurers’ sustainability initiatives, revealing that while most insurers actively incorporate sustainability features into private products, fewer apply them commercially and few measure their actual environmental impact. The regulator notes that pricing novel sustainability risks remains challenging and emphasizes that insurers must substantiate their sustainability claims with concrete, measurable data rather than merely tracking feature usage. The AFM encourages the sector to continue collaborative efforts and standardize impact measurement while maintaining ongoing supervisory focus on sustainability practices.
News
02/04/26
Almost all insurers state that their sector plays a crucial role in the energy transition. They are also actively fulfilling this important role, as the AFM observes in research among property and casualty insurers. They report many sustainability features on private products, but fewer on commercial ones. We see room for improvement in measuring the impact of sustainability features that insurers attach to their products.
In brief
Insuring sustainability risks: new and not easy to price
Many sustainability features on private products, fewer on commercial ones
Room for improvement in measuring the impact of sustainability features
Insurers are seriously working on sustainability, the AFM will maintain its focus
Insuring sustainability risks: new and not easy to price
Insuring the new risks that arise in a market like the sustainability market presents challenges. The risks are often new and unknown, making them difficult to price. This ranges from the fire risk of a home battery to the entire risk profile of a hydrogen plant. The sector also notes this in its recent position paper on the insurability of the energy transition in the commercial market.
Many sustainability features on private products, fewer on commercial ones
Property and casualty insurers report many sustainability features on private products, but fewer on commercial ones. This is evident from research conducted among a large number of property and casualty insurers regarding sustainability features in their products, underwriting processes, and other activities. By sustainability feature, we mean any element of an insurance product or process related to sustainability. For example, underwriting conditions, preventive measures, or specific coverages. Insurers themselves decide which elements they consider sustainability features.
Room for improvement in measuring the impact of sustainability features
Insurers rarely measure the impact of a specific feature on sustainability. As our research also shows, this occurs in less than half of the cases. In 59% of cases where insurers state they measure impact, they only measure the usage of a specific feature. For example, they may measure how many customers receive their policy terms digitally, but not the resulting CO2 emission savings. Without insight into the actual impact, it is more difficult to substantiate how a feature contributes to sustainability. We therefore see room for improvement in measuring the impact of the sustainability features insurers attach to their products.
The disclosure standards require that insurers' sustainability claims are correct, clear, and not misleading. The AFM's Guidelines on Sustainability Claims provide insurers with tools to do this well. The AFM's ESG update on sustainability claims emphasizes that sustainability claims must be concrete and well-substantiated.
Insurers are seriously working on sustainability, the AFM will maintain its focus
We see that insurers are seriously engaging with the sustainability theme and are also collaborating to create greater impact. They do this, for example, on sustainable claims repair and by introducing standards to measure the CO2 emissions of their portfolio. This can lead to reliable, comparable measurements and a uniform interpretation of certain terms. The AFM therefore encourages the sector to continue setting up and implementing such initiatives. We will continue to monitor sustainability closely.
Tags
Insurers
More information
AFM research on sustainability among property and casualty insurers (pdf, 154 kB)
AFM Thematic page on Sustainability
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