Insurance Companies Have Little Over $1.03 Trillion in AuM

Members of the International Cooperative and Mutual Insurance Federation (ICMIF), which include takaful companies, have $1 trillion in assets under management (AuM) in investments which are aligned to sustainable investment frameworks, and an increase of 32% from the $759 billion collectively invested by members in 2022.

According to the 2023 edition of the “ICMIF Members Sustainable Investment Report,” the data in the report shows that ICMIF members have aligned $1,003 billion with sustainable investment frameworks, which includes green bonds, social bonds, and resilience bonds for example, many of which will be targeting climate change and its effects.

The report said that mutual and cooperative insurers represent almost 30% of the world’s insurance market and $10.4 trillion in assets.

Shaun Tarbuck, ICMIF CEO said that the latest edition of the ICMIF Members Sustainable Investment Report revealed the results of the 2023 ICMIF Sustainability Investment Framework Survey which are testament to how ICMIF members have continued to increase levels of alignment with sustainable frameworks since the inception of our survey in 2019.

“The insurance industry is uniquely positioned to assist with delivering climate action as it has both the assets to invest and the in-depth knowledge of the many risks that need to be mitigated both on a macro level and a community level to make people and the planet more resilient,” Tarbuck added.

The report highlights ways in which ICMIF members are continuing to lead by example in in terms of sustainable investments.

Key Findings

This alignment of more than $1 trillion to sustainable investment frameworks represents 79.4% of AUM for the members that responded to the survey, compared to 51% last year.

The survey found that 60% of ICMIF members invest in impact investing, up from 55% in the 2022 survey. Impact investing by ICMIF members has grown a staggering 575% from last year, to $105.6 billion with five members stating that over 10% of their total AUM are invested in impact investing and one member is investing 68% of its AUM in impact investing.

As many as 57% of responding members invested in sustainable bonds including green bonds, social and/or resilience bonds, amounting to $18.3 billion, compared with $16.9 billion in the 2022 the survey showed.

Some 40% of ICMIF members have made net-zero commitments, up from 37% last year. Even the sustainability reporting is growing with 77% of members stating that they actively report on sustainability in some way.

Furthermore, 59% of ICMIF members said they were either compliant or expected to be Task Force on Climate-related Financial Disclosures (TCFD) compliant in the next few years.

In all, 136 ICMIF members were interviewed and 35 among them responded to the survey, representing 26% of the ICMIF membership. Those that responded represented 74.4% of ICMIF members’ assets under management for 2023, equating to $1.3 trillion, the report added.