PARTNER CONTENT

Insurance Contributesto the Energy Transition

By providing financial stability for market players participating in the energy transition, insurance is a prerequisite for its success. The market offers many solutions needed by investors, both corporate and individual. Climate change is a challenge for all. Public bodies must take action to implement solutions that will, among others, improve the hydrologic balance.

Jan Grzegorz Prądzyński, President, Polish Chamber of Insurance PIU

T he objective of curbing the impact of climate change is forcing the governments of Poland and other EU Member States to take action. This includes energy transition. Poland has drawn up a strategic document: the Polish Energy Policy 2040 (PEP2040). According to the Policy, the share of energy from coal will fall to 28 percent in 2040 from 69 percent in 2020. What this implies for insurers is that insurance in this sector will shrink, while opportunities to insure investments in renewable energy sources will expand. Insurers also have to consider a number of new EU regulations on ESG in the broadest sense, which promote their involvement in green energy sources. Importantly, this includes not only insuring and reinsuring such systems but also investing in those solutions. At the end of Q3 2022, the insurance industry’s investments in debt, equity and other variable income securities amounted to almost PLN 97 billion. Some of this money can be invested in such projects directly or indirectly, for instance by buying bonds.