California Commissioner Wants Insurers to Withdraw Russian Financial Support

California Insurance Commissioner Ricardo Lara on Monday issued a notice to all insurance companies doing business in the state to review their financial holdings and take immediate steps to identify and divest from any direct investments in Russian assets or property that could support Russia in the wake of its invasion of Ukraine.

“California stands with the world community in rejecting Russia’s invasion of Ukraine and its assault on freedom and equality,” Lara said in a statement. “As the nation’s largest insurance market and the fourth largest insurance market in the world, we must not tolerate California consumers’ insurance premiums funding an authoritarian regime that invades a sovereign government, terrorizes its population, and is an enemy of free expression, speech, assembly, press, and equality for LGBTQ+ people, women, and ethnic and religious minorities. Insurance companies must send a loud and clear message of solidarity with the people of Ukraine and the global community by withdrawing any financial support for the Russian regime.”

The legislative leaders of the California Senate and Assembly Insurance Committees joined Lara in calling on insurance companies to take immediate action.

“The people of California are united in our resolve to support the people of Ukraine, and insurance companies have a duty to use their market power for good, not to support a corrupt regime that is an enemy of freedom,” state Sen. Susan Rubio (D-Baldwin Park), chair of the California Senate Insurance Committee, said in a statement. “I am ready to support the goals that Commissioner Lara has laid out for insurance companies to divest all investments that benefit the Russian government’s campaign of tyranny.”

A statement from Assemblyman Tom Daly (D-Anaheim), chair of the Assembly Insurance Committee, reads:

“Californians join the world in denouncing Russia’s brutal invasion of Ukraine and its continued heinous violations of human rights. Because of the size and strength of California’s insurance market, actions by insurance companies doing business here to reevaluate their investments and hold Russia accountable will be felt around the world.”

Direct investments of U.S.-based insurers exposed to Ukraine and Russia reportedly include nearly $2 billion in bonds while indirect investments in businesses that derive a share of earnings from Russia may be more substantial.

In the Notice, Commissioner Lara alerted insurance companies that he will use all remedies available under California insurance law to push the industry to demonstrate that they are aligning with the global community to hold Russia accountable.

“If insurance companies do not voluntarily act now to dispose of direct investments in Russia, I will explore all options to compel them to follow through,” he said.

Topics California Carriers Russia