ESG Insurance Underwriting

Our integrated solution for portfolio managers and underwriters combines public and private company data, a double materiality assessment framework, and new analytics. These help insurers identify correlations between ESG factors and financial-risk metrics, such as claims frequency and loss ratios.  Enabling insurers to identify the accounts that contribute to portfolio-level ESG performance pre- and post-bind to help gain a competitive advantage.

ESG creates both risk and opportunities for P&C insurers to grow their business, that provides another lens through which to view risk selection and appetite. The door is open for P&C insurers to build competitive advantage by imposing their own view of ESG risks, redefining risk appetites, and incorporating ESG into the decision-making process. Insurers can also critically engage with their insured entities, especially those with emission-intensive activities, on their decarbonization strategies and net-zero transmission paths.

Assess the impact of your insured entity on the planet and society

Double materiality is the cornerstone of our approach. By understanding how risks in the global economy are interconnected, our definition of double materiality includes two types of exposure.

• Business exposure: the extent to which ESG factors have or are likely to have direct or indirect impacts on a business’ strategic assets, activities or financial performance.
• Stakeholder exposure: the positive or negative impacts that a business has or is likely to have on its stakeholders resulting from its operations, products, services and value chain.

Materiality defines why and how certain issues are important for an insurer.  Double materiality extends this concept and considers the impact on environmental and social stakeholders. 

Ensure no gaps in your portfolio

Moody’s has been a pioneer of ESG analysis for more than three decades. Our ESG company scores consider 273 data points and include monitoring and alerts for ESG risk events. Our database of 450 million company records, coupled with our ESG score predictor algorithms, enables us to provide ESG scores and sub-indicators for more than 290 million public and private companies, helping insurers assess their often-diverse portfolios.