European life insurers to ramp up green capital allocations

The majority of European investors in the life insurance space plan to increase their climate and ESG-related investments.

More than nine in 10 European life insurance companies that took part in a survey that was shared with Net Zero Investor confirmed they plan to up their capital allocations to investments with a positive climate impact. Only 8% said they may do so later.

Half of the group of insurers that said they will ramp up their sustainable investments, which collectively oversee €2.73 trillion in assets, disclosed to researchers from real asset manager AlphaReal, they plan to do so between 15% and 20% over the next two years. 

A quarter will increase by 10% to 15%; nearly a fifth (18%) will increase allocations by 20% to 25%; 5% say they will increase by 25% to 30%; while 1% will boost allocations between 5% and 10%.

Green investment considerations are now ‘very important’ for 22% of the insurers and ‘important’ for more than three-quarters (77%); while only 1% say they are neutral on these issues.

The green push is further reflected in the relatively high level of support the firms show to meeting Europe’s net zero carbon emissions target by 2050. 

Nearly all (94%) European life insurers have a carbon net zero commitment, with 6% currently not having one in place.

Net Zero Investor's Annual Conference | 11th December 2023 | London