Chubb latest U.S. insurer to face shareholder resolution on fossil fuel underwriting



Chubb’s board of directors has called on shareholders to vote against proposals that would restrict fossil fuel underwriting at its upcoming annual general meeting (AGM). The SEC didn't approve a request from Chubb to keep the shareholder resolution off the proxy ballot for its May 19 meeting.

One of the country’s biggest property and casualty insurers is about to face the first-ever shareholder vote over whether the company should provide coverage for new fossil fuel sources. On Monday, Green Century Capital Management announced that the Securities and Exchange Commission did not approve a request from Chubb to keep the shareholder resolution off the proxy ballot for its May 19 meeting. As of Monday, the no-action letter had not yet been published on the SEC’s site.  

It marks the first shareholder resolution in what is likely to become a long campaign targeting insurance companies over their roles in climate change. This proxy season, Green Century has also filed similar proposals at The Hartford and Travelers Insurance. Like Chubb, those firms have also requested no-action letters from the SEC to advise them about keeping the resolutions off proxy ballots.

“This is the first time these resolutions have been proposed,” said Andrea Ranger, a shareholder advocate at Green Century.

It’s a novel way of attacking climate change, although banks are also being targeted over their relationships with fossil fuel companies.

“Without insurance, almost none of the [new fossil fuel] projects can go forward,” Ranger said. “The banks won’t lend without the companies having insurance.”

The SEC has yet to publish its determinations on the resolutions at The Hartford and Travelers. Representatives for Travelers and Chubb did not comment. 

A spokesperson for The Hartford said in an email that the company values shareholders’ perspectives, carefully considers each shareholder proposal and “view[s] the transition to a greener society as a business imperative and are proud of our progress.”

“Our long-standing commitment to sustainability is demonstrated by our actions across the business including sustainable products, transparent disclosure of climate-related goals, risks and operational impacts, and investments in renewable energy,” the spokesperson said. “We remain determined to use our resources responsibly to address the challenge of climate change and are committed to keeping our stakeholders informed of our progress.”

The SEC’s recent decision related to Chubb follows a March 7 no-action letter in response to a request from Citigroup to exclude a similar shareholder proposal from its proxy ballot. That resolution asks the company to develop measures by the end of this year to ensure its lending and underwriting do not contribute to new fossil fuel supplies. That proposal, the SEC wrote, “does not seek to micromanage the company.”

“When that proposal went through, we were elated, because we had a very similar resolved clause. And it indicated which way the winds were blowing at the SEC,” Ranger said.


Part of the investor case for changing underwriting policies at insurers is that some clients’ activities hurt others, according to Green Century. By providing coverage for new fossil fuel projects and allowing energy companies to operate, insurers are helping to further climate change, which in turn leads to property loss and claims for people affected by extreme weather events, the company says.

Chubb “is uniquely exposed to climate risks because it underwrites policies meant to protect its customers’ homes and businesses from the impacts of climate-driven catastrophes such as storms, wildfires and heat waves,” the shareholder proposal states. “It simultaneously underwrites policies for the fossil fuel industry, whose emissions are widely believed to amplify devastating storms, wildfires and heat waves. These practices are fundamentally incompatible.”  

Green Century notes that Chubb, like some other insurers, has some restrictions on underwriting energy projects, such as those involving coal. But that isn’t enough to help curb global emissions, the fund manager said.

“No one believes in climate change like insurers — especially the reinsurers,” Ranger said.

Data about insurers’ risk calculations or client lists are largely unavailable to the public, she noted.


Along with the Green Century resolution, Chubb and other insurers are also facing proposals from As You Sow that they begin measuring and disclosing emissions associated with their full ranges of operations and set net-zero targets.

“It’s difficult for insurance companies to quantify all their emissions, because there isn’t a methodology at this point,” Ranger said, noting that Green Century and As You Sow are taking a joint approach in filing their respective resolutions.

Chubb stated in the proxy statement it filed with the SEC that it encourages shareholders to vote against both resolutions.

Chubb supports “a global transition to a net zero economy by 2050 and we have acknowledged our responsibility to take action to support and encourage this transition,” the company stated.

“We are making appropriate commitments on climate action, including limiting certain underwriting activity. But underwriting limitations must be balanced against the essential and core purpose of insurance, which society expects us to fulfill, to provide risk protection for lawful activity,” the statement read. “Any such limits on entire classes of activity interfere with this purpose and must be an exception based on analytical, fact-based examination of realistic alternatives.”

How much support the new shareholder resolutions on underwriting will see from institutional investors is a big question. Green Century is not counting on getting a majority vote right away.

“I don’t have a good sense of how this is going to play out,” Ranger said. “We do anticipate that this is going to be a multiyear proces

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