Insurers and reinsurers are being urged to end all support for new oil and gas projects to help ensure that international climate targets are met.

Bermuda’s major role in the reinsurance sector, together with the island’s vulnerability to stronger hurricanes and rising sea levels, are seen as reasons why it should be concerned and also willing to take action to step away from underwriting and investing in new oil and gas projects.

Peter Bosshard, a leading figure in a worldwide campaign to convince the insurance industry to end support for fossil fuel projects, said: “We have noticed that several insurers headquartered in Bermuda play a major role in the oil sector; Argo, for example, and Everest and Aspen.

“As an island nation, Bermuda is particularly vulnerable to climate change, so it is in the long-term interest of all actors also in Bermuda to reorient their business model in a way that doesn’t destroy our future.

“Along with the rest of the industry, I think specialty insurers need to make this change.”

During the past three years, the campaign has succeeded in making some insurance companies step away from underwriting and investing in the coal industry. Now it has broadened its scope.

It has sent letters to the chief executive officers of leading insurance companies, including American International Group, Axa, and Bermudian-based Axis Capital, urging them to end support for new oil and gas projects.

Reflecting its expanded focus, the Unfriend Coal campaign is renaming itself Insure Our Future.

The group said that a quarter of the world’s top 15 oil and gas insurance companies back the 2015 Paris Agreement target of limiting global warming to 1.5C above pre-industrial levels.

Seven of the top insurance companies have already limited support for fossil fuels by restricting insurance for coal.

The letter to the CEOs is signed by 18 international organisations, including Greenpeace, Oil Change International and 350.org.

It states: “Insurers have a responsibility to support international climate targets and align their businesses with the Paris Agreement.

“As governments plan the recovery from the Covid-19 crisis, insurers need to champion the transition to a sustainable, fair and resilient future as underwriters, investors and corporate citizens.”

A United Nations panel on climate change has warned that if global temperature increases are to be limited to 1.5C without relying on carbon capture and storage technologies yet to be proven viable, the consumption of oil must decrease by 87 per cent, and gas by 74 per cent, by 2050.

Mr Bosshard, the global co-ordinator of the Unfriend Coal/Insure Our Future campaign, told The Royal Gazette that the value of sustainable and renewable energy had been highlighted during the Covid-19 pandemic, as it had faired better than the fossil fuels.

He said: “No one wanted the disruption of Covid-19, but it is a disruption to the energy sector. Renewable energy is the only sector that held up — investment went down, but generation remained even at the same level, whereas all the fossil fuels are slumping. So this crisis will accelerate the shift to renewables. It is the right time for insurance companies to reorient their energy business.”

After identifying the top 15 oil and gas property and casualty insurers, the campaign found that four have pledged to align their investment portfolios with a maximum 1.5C of warming. The four are Axa, Allianz, Munich Re and Zurich.

It said seven, including Axa, Chubb and Liberty Mutual, had limited their support for fossil fuels by restricting insurance for coal. However, three companies had taken no action on fossil fuel insurance, those are AIG, which has operations in Bermuda, Travelers and Tokio Marine.

The Unfriend Coal/Insure Our Future letter has been sent to the CEOs of 29 insurance companies, including Chubb, Legal and General, Liberty Mutual, Hannover Re, Sompo, which all have a presence in Bermuda, and the CEO of Lloyd’s.