Insurance Companies and Coal

Leading insurance companies in the world have started to exit the coal sector. Japanese insurers need to take action now.

Non-life insurance companies play a key role in accelerating the transition of modern industrial society to a low-carbon economy. Without insurance coverage or underwriting, most coal-related projects cannot get loans from banks. Without loans from banks, it is difficult for a project to obtain the necessary funding and government permits for new coal mines and power generation projects. Moreover, without insurance, it would not be possible to set up infrastructure nor operate a project.

Insurance companies have warned about climate risks for decades – based on science. Their losses from climate disasters have skyrocketed in recent years. 

Moving away from coal

Since 2017, leading insurance companies have started to move away from coal. By December 2020, 23 leading insurers – including industry giants like AXA, Swiss Re, Hannover Re and Zurich – have adopted policies to stop or limit insurance for coal projects. These insurers control 12.9% of the primary insurance market and 48.3% of the reinsurance market.

In addition to coal, 9 insurers and reinsurers have ended or limited underwriting for tar sands, which negatively impacts the environment. Australia’s Suncorp is the first insurance company to announce that it will phase out underwriting for oil and gas projects (as of December 2020). 

At least 65 leading insurance companies have either adopted a divestment policy or committed to making now new investments in coal. 

According to Willis Towers Watson, a global insurance broker, the exit of insurers from the coal sector has already made it more complicated and expensive for coal companies to find insurance for their projects. The insurance industry’s movement to withdraw from the fossil fuel sector is accelerating every year.

Japan’s major non-life insurance companies

Tokio Marine, MS&AD and SOMPO are Japan’s major non-life insurance companies and they are also among the leading global insurers in the power and energy sector.

Japanese insurers have made public sustainability commitments in recent years, but they continue to insure climate-destroying coal projects. 

In September 2020, Tokio Marine, MS&AD and SOMPO announced a policy to stop insurance underwriting and investment for coal-fired power projects and stated that, in principle, they will not underwrite or invest in new coal-fired power projects. However, all three insurers’ policies include exceptions that they may provide underwriting for projects in consideration of the host country’s national energy policy, energy situation, power generation efficiency, etc. Moreover, their policies do not apply to insurance underwriting and equity/bond investment for companies that are highly dependent on coal-fired power generation or companies planning to build new coal plants, nor do they mention underwriting and investing in coal mining and other fossil fuel-related projects.  

Tokio Marine

Tokio Marine’s policy states that, in principle, it will not provide new insurance underwriting capacities and financing for coal-fired power generation projects within and outside Japan. However, the policy has loopholes where Tokio Marine “may grant exceptions for projects on account of circumstances such as national energy policy and other considerations in the relevant country, and in the context of the OECD Arrangement on Officially Supported Export Credits and other international guidelines.”


MS&AD’s policy states that, in principle, it will not provide insurance underwriting or investment for new coal-fired power plants within and outside Japan. However, the policy has loopholes where MS&AD “will carefully consider and correspond for cases that are essential to a stable energy supply in the relevant country.”


SOMPO’s policy states that, in principle, it will not insure and invest in new construction of coal-fired power plants in Japan. However, the policy has loopholes where “in the case of power generation with power efficiency exceeding the certain level in accordance with the energy strategy of the Japanese government, [SOMPO] may consider providing insurance or investment with careful thought confirming measures to reduce environmental impacts, such as the reduction of greenhouse gas emissions and alternative means.”


(Source: Tokio Marine, MS&AD and SOMPO’s Releases on their underwriting policies for insurance underwriting and investment)

In the “2020 Scorecard on Insurance, Fossil Fuels and Climate Change”, which ranks 30 leading global insurers based on underwriting for coal, oil and gas, Tokio Marine, MS&AD and SOMPO ranked 18th out of 30 due to the many loopholes in their policies.

Our demands

No Coal Japan and the Insure Our Future campaign call on Japanese insurers to immediately:

  • Eliminate exceptions from underwriting policies for coal-fired power projects
  • Limit or phase out underwriting not only for coal-fired power projects but also for coal mining, tar sands, oil and gas projects. 
  • Stop underwriting and investing in stocks/bonds for companies that are highly dependent on coal-fired power generation or are planning new coal power projects. 
  • Develop business operations to limit the rise in the average global temperature to a maximum of 1.5 degrees.