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Senator queries industry's 'deafening silence' on emissions

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A Senate inquiry hearing today into the 2019/20 bushfire season has called out insurers’ “deafening silence” on the urgency of cutting carbon emission levels, forcing the industry to defend its climate action stance.

Senator Tim Ayres, who is heading the inquiry as Chair of the Finance and Public Administration References Committee, questioned why insurers are so vocal in pushing for increased action on mitigation, but not emissions reductions as a way to keep premiums affordable as climate change-fuelled weather events become more frequent and severe.

“I appreciate the points about affordability and mitigation,” he told senior executives from IAG, QBE, Suncorp and Allianz at the hearing. “But where is the urgency about efforts to reduce emissions whether at the global level or here in Australia?

“You are keen to push the Government along on a whole range of questions, but there is a deafening silence when it comes to climate change and emission reductions.”

Allianz, which was asked first by Senator Ayres to respond, said its efforts have been made globally and in Australia to deal with the environmental threat posed by global warming.

On the lack of action on emissions reductions, Chief Corporate Affairs Officer Nicholas Scofield said “it just comes down to the fact that emissions reduction is a very polarised debate in Australia”.

“And I think as insurers we have taken the view that we don’t want to put ourselves in the middle of a highly charged political debate.

“We’d rather just focus on what we see as the issues, the impact on us as insurers and our customers and focus on things that we can advocate that will directly deal with some of the issues that are arising. Essentially it’s around the impact on affordability driven by increasing frequency and severity of natural weather events.”

But Senator Ayres was not persuaded, saying the industry has not held back in pushing for insurance taxes to be axed despite the “highly charged debate” over the matter.

Suncorp EGM Motor Property and Specialty Claims Michael Miller later acknowledged the industry “should start to have a harder voice” on the matter.

Outgoing Insurance Council of Australia CEO Rob Whelan, who voiced his regrets in not pushing for stronger climate action in an interview with Insurance News magazine, was pressed for his views on the industry’s reluctance to address emission reductions.

“I understand your point but…there is an immediate need to act to be able to provide appropriate mitigation measures and adaption measures to protect communities now,” Mr Whelan said. “So that’s one side of the argument.”

He said the challenge of addressing emissions reductions “is a much bigger issue to be engaged in at a much higher level than just the insurance industry” and that insurers are ready to contribute to the debate.