Shareholders Respond to Climate-Related Insurability Crisis
FOR IMMEDIATE RELEASE
MEDIA CONTACT: Ryon Harms, [email protected], (310) 730-9407
EL CERRITO, CALIFORNIA—Dec. 15, 2024— In a resolution filed with Travelers Insurance by As You Sow and Trillium Asset Management, shareholders ask Travelers to explain if and how it can maintain a viable homeowners insurance business as catastrophic climate-related weather events increase payouts, force unaffordable rate increases on customers, and shrink the areas where profitable insurance coverage can be provided.
Travelers’ climate-related catastrophe losses surged from $1.85 billion in 2021 to $3.33 billion in 2024. Travelers responded by, among other actions, requesting a 15% rate increase from 320,000 policyholders in California and by dropping more policies in high-risk markets. This approach transfers climate costs to policyholders and taxpayers, leaves more homeowners uninsured, and strains state-run FAIR plans —contributing to instability in the housing market.
"While Travelers argues that it can reduce its exposure to climate risk through pricing adjustments and geographic retreats, the reality is that too many consumers can no longer bear higher insurance costs and it remains unclear how many customers and coverage areas Travelers can afford to lose before its homeowners business line becomes unprofitable,” said Danielle Fugere, President and Chief Counsel of As You Sow. "Shareholders request transparency on the question of whether a contracting customer base will ultimately undermine profitability.”
“To adequately assess Travelers’ long-term financial sustainability, investors need to understand how climate-driven business decisions affect customer retention across different climate scenarios," said Andrea Ranger, Director of Shareholder Advocacy at Trillium Asset Management.
In a second proposal recently filed by As You Sow with insurer Chubb Limited, shareholders asked the insurer to investigate the potential for recovery of customer payouts through subrogation claims against the parties responsible for causing climate change. Seeking contributions from responsible companies, including fossil fuel companies, can help stem the insurance affordability crisis by offsetting catastrophic climate-related costs now borne by homeowners, while also pricing climate risk into the market for high carbon products. A third proposal was filed at Berkshire Hathaway, asking it to disclose the greenhouse gas emissions associated with the Company's underwriting and insuring activities.
As noted in previous shareholder proposals, both Travelers and Chubb contribute to climate change by investing in and insuring high carbon companies.
“As climate disasters intensify, shareholders seek comprehensive strategies from insurers to reduce and address this growing problem,” said Mary Zuccarello, Climate Program Associate at As You Sow.
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As You Sow is the nation’s leading shareholder representative, with a 30+ year track record promoting environmental and social corporate responsibility and advancing values-aligned investing. Its issue areas include climate change, ocean plastics, toxins in the food system, biodiversity, racial justice, and workplace diversity. See As You Sow's shareholder resolution tracker.