Hannover Re to exclude coal from future investments

One of the world’s largest reinsurance companies has taken steps to exclude coal from its future investments.

German-based Hannover Re will divest from all companies which depend on coal power for more than 25 percent of its revenues. However, unlike some companies, such as AXA and Allianz, it will continue to provide insurance to coal plants for the time being.

The Unfriend Coal campaign was informed of Hannover's decision, and that it would continue to reinsure fossil fuels because it is “not our place, as a private company, to act contrary to the decisions of sovereign nations”. The company would still “welcome a shift in the energy mix towards alternative energy sources” though.

According to Unfriend Coal, almost half of the global reinsurance market has now pledged to divest from coal, including major players, such as Generali, Lloyd’s of London, and Swiss Re. Divestment policies across the industry now cover assets worth more than $6 trillion and $30 billion has already been withdrawn from the coal sector, according to the group.

Peter Bosshard, coordinator of the Unfriend Coal campaign, said: “The world’s ultimate underwriters of risk clearly see no future for a fuel which is the biggest single source of carbon emissions. This sends a strong message to the governments, investors and financiers that decide on the future of the global energy sector.

Regine Richter, finance campaigner at environmental NGO Urgewald, said Hannover’s divestment was “a welcome first step”, but that it was disappointing the group was not taking responsibility for “the climate impacts of its own underwriting decisions.”

“The company’s 25 percent threshold for defining coal companies is stricter than the definition of its peers, even though it misses out additional exclusion criteria such as the development of new coal projects,” she added.