Chaucer, Moody’s rollout ‘first-of-its-kind’ ESG scorecard for P&C insurers

Moody’s has launched a “first-of-its-kind” ESG Insurance Underwriting Solution for property and casualty insurers, enabling them to integrate environmental, social and governance (ESG) factors into commercial underwriting and portfolio management activities. The solution was born out of a collaboration with global specialty re/insurer Chaucer.

The scorecard’s design combines Chaucer’s insight into counterparty risk with Moody’s deep ESG and risk modelling expertise to evaluate businesses’ risks and opportunities at an in-depth level. The data driven scorecard will measure the ESG performance of clients and business partners, helping them to become more sustainable across underwriting, operations, and investments.

Chaucer said one of the aims of the scorecard is to help incentivise businesses to make greater disclosures relating to ESG factors, and address the major challenge facing the re/insurance industry to have access to relevant and reliable ESG data to assess counterparties.

John Fowle, chief executive officer of Chaucer, explained: “The (re)insurance industry has a pivotal role to play in helping corporates make the transition to become more sustainable. This isn’t going to happen overnight but by helping clients identify, manage and measure areas that are in need of improvement, we can help them implement incremental changes that will pay dividends in the long-term.”

“(Re)insurers also need to consider their own ESG profiles and what action the industry as a whole can take to improve its credentials. The data provided through the ESG balanced scorecard will help Chaucer and other (re)insurers establish their strengths and weaknesses and give them a steer on which areas need greater attention or investment.”

Colin Holmes, general manager of insurance at Moody’s Analytics, said: “As insurers are seeking to measure the ESG impact of their portfolio, alongside the assessment of traditional insurance risks, this new offering is a great example of how our integrated risk-assessment strategy helps meet our customers’ needs.

“We are delighted they have been able to leverage the capabilities of our ESG Insurance Underwriting Solution to create a first-of-its-kind ESG balanced scorecard to provide a transparent and authentic approach to ESG risk assessment.”

Mike Steel, general manager of RMS, a Moody’s Analytics company, added: “We designed Moody’s ESG Insurance Underwriting Solution, with the support of Chaucer Group, to help (re)insurers operationalize the way they measure ESG risk at the point of underwriting. We can do so through the combination of data, technology and industry knowledge that we now have at our disposal following the Moody’s acquisition. By bringing these capabilities together, we are helping underwriters and portfolio managers transform ESG data into new insights on ESG risks and opportunities.”

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