Environmental Practices and Insurance Companies. Evidence from Europe

This chapter focuses on a particular type of financial intermediary: insur-ance companies. The chapter aims to examine how insurance companies address climate risks and the transition to a sustainable economy. To this end, an empirical investigation has been conducted on a sample of 60 European-listed insurance compa-nies, observed over the six-year period going from 2017 to 2022. The analysis carried out through a panel model investigates the relationship between the environmental performance of insurance companies and their main features, such as company's solvency, economic performance and climate-related risks and opportunities, using sustainability indicators. The main findings of the analysis show that better economic performance of insurance companies is associated with better environmental perfor-mance, especially with performance related to companies' emissions and environ-mental innovation. The insurance companies that develop new products/services to overcome the threats of climate change are associated with better environmental performance, except for those concerning the use of resources.