California Insurance Commissioner Dave Jones responded to challenges to his calls for insurers to disclose their investments in fossil fuels.
Oklahoma’s attorney general has sent a letter to Jones threatening legal action if that state continues with its policy of requiring insurance companies to publicly disclose investments in fossil fuels.
Jones under his Climate Risk Carbon Initiative has sought to make public insurer investments in coal. In a further step, in late January he asked all insurance companies doing business in California to voluntarily divest from their investments in thermal coal and become part of a nationwide drive to reduce carbon emissions and battle climate change.
To comply with this request would mean making no new investments, not renewing existing investments and selling or withdrawing from existing investments in thermal coal, according to the California Department of Insurance.
Jones’ divestment request is voluntary, and specifically requests a divestment from any entity that either extracts or burns thermal coal or that derives 30 percent or more of its revenues from thermal coal.
The data call initiative that Jones announced last year requires insurance companies to annually disclose their carbon-based investments, which includes investments in oil, gas and coal. The data call is targeted to companies selling in the California market that have at least $100 million in premiums nationally.
Oklahoma’s Attorney General Mike Hunter said Jones’ Climate Risk Carbon Initiative policies will harm the energy industry. Hunter also wants California to stop calling on insurers to pledge divestiture from the coal industry. Hunter’s letter was signed by 11 other state attorneys general and one governor.
This didn’t sit well with Jones.
“While politicians in coal, gas, and oil states continue to deny the existence of climate change, California has concluded based on overwhelming scientific evidence that climate change is real,” Jones wrote in statement responding to Hunter’s call. “The threats of lawsuits by 12 red state attorneys general and one governor are not going to stop me from doing my job as insurance commissioner to make sure that insurance companies are recognizing potential financial risks associated with climate change.”
Jones said it is his job to make sure insurance companies address potential risks to their investment portfolio.
“Climate change poses a potential financial risk to insurance company investments in coal, oil, gas, and utilities that rely on carbon to generate electricity,” Jones wrote.
He said the shift away from fossil fuels and toward renewable energy, as well as regulatory and policy changes at local, state, national, and international levels, make investments in oil, gas, and coal, and utilities that rely on oil, gas, and coal, a risk for insurer to have “stranded assets” on their books with significantly reduced or no value.
“For those climate denying politicians of red states who threaten to sue me, I will happily defend my obligation as California’s Insurance Commissioner to make sure insurers are addressing climate change related risks and to protect California consumers,” he wrote.
Related:
- Oklahoma AG Threatens California Commissioner on Insurer Fossil Fuel Rules
- California’s Climate Risk Database Calls Out Insurer Carbon Investments
- California Commissioner Explains Call for Insurer Divestment from Coal
- Insurer Fossil Fuel Divestment Focus of Washington Climate Change Summit
- Report Calls Out Insurers for Half-a-Trillion Dollars in ‘Dirty Energy’ Investments
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