The Annual Conference Series: The green transition: unleashing our sector’s assets for sustainable growth

Climate change is rightly at the top of the agenda for ministers, regulators and the insurance and long-term savings industry alike. The imperative for policymakers is to increase the level of funding available for new infrastructure and technology that can help reduce and mitigate the impact of climate change, while more broadly refashioning the UK economy towards sustainable, long-term growth. Independent analysis suggests that ABI members could support up to one-third of the circa. £2.7 trillion of investment in infrastructure and energy transformation required to meet the UK’s Net Zero targets over the next thirty years.

A key factor in influencing the assets that insurers choose to hold is prudential regulation. With HM Treasury’s Solvency II and Future Regulatory Framework (FRF) Reviews well under way, the insurance and long-term savings industry faces a once in a generation opportunity to consider how a more appropriate regulatory regime and framework could enable firms to redirect a greater portion of their more than £2 trillion in investments towards green assets.

What will you learn?

By the end of this session, delegates should be able to better understand the scale of the opportunity and the barriers for insurers to support the transition to net zero through their investments, especially in the context of the Solvency II Review. Delegates should be able to gain insights into the objectives, opinions and next steps for HM Treasury, the PRA and the industry to enable insurers’ investment into green assets, while understanding the fault lines of opinion on Solvency II reform. Delegates should gain an appreciation for which aspects of Solvency II reform in particular (e.g. Matching Adjustment) present a meaningful opportunity to increase insurers’ investment in green assets and which types of “net-zero assets” are most appropriate to sit on insurance balance sheets.