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| Zenith Insurance Company | 13269 | - | N | - | 2022 | - | - | Property & Casualty | At Zenith Insurance Company and its wholly-owned subsidiary, ZNAT Insurance Company (collectively “Zenith”), we are aware of the potential risks associated with climate change and that is why we take a long-term approach to how we manage and monitor our exposure. Governance of climate-related risks and opportunities is a shared responsibility between Zenith and Zenith’s ultimate parent company, Fairfax Financial Holdings Limited (“Fairfax”).
Zenith’s Executive Leadership team has oversight of Zenith’s overall environmental, social and governance (“ESG”) approach, including climate-related risks and opportunities. It reviews ESG matters each year and participate in a formal group-level committee that includes all of Fairfax’s operating companies. Zenith’s information rolls up into an ESG Report published by Fairfax.
The Executive Leadership team led by the CEO assesses climate-related risks and opportunities through a combination of careful monitoring of exposures, underwriting controls, and reinsurance. Zenith’s General Counsel oversees functions responsible for ESG matters.
Fairfax has established a global risk committee. The committee is chaired by Fairfax’s President & Chief Operating Officer and includes senior officers of Fairfax’s subsidiary insurance entities, including Zenith. The purpose of the committee is to provide clear and consistent monitoring, measuring, modelling and aggregating of all risks across the Fairfax enterprise and for the individual companies. Environmental risk is viewed as a category of business risk, and it is part of the overall decision-making process when assessing an investment.
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| Secura Supreme Ins Co | 10239 | 96 | Y | - | 2022 | - | Secura Ins Grp | Property & Casualty | SECURA’s Audit and Risk Committee of the Board of Directors is responsible for enterprise risk oversight. Within risk management, climate-related financial risks are included. The Committee receives updates at least three times a year. All risks are categorized into one of four buckets: operational, financial, strategic, or hazard. The Enterprise Risk Management Committee (ERM), which consists of executive leadership, meets on a regular basis to discuss current and emerging risks and discuss mitigation strategies. |
| Ohio Ind Co | 26565 | - | N | - | 2022 | - | - | Property & Casualty | We do not write any types of business that are materially impacted by climate change or catastrophe risks. Our financial investment strategy is likewise focused on investments that are not materially affected by these types of risks.
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| FCCI Ins Co | 10178 | 474 | Y | - | 2022 | - | FCCI Insurance Group | Property & Casualty | A. Although the company does not have a written climate change policy in place, FCCI does recognize that climate change has the potential to impact our company, the risks we insure, and our investment returns. Climate-related risks are integrated within FCCI’s Enterprise Risk Management (ERM) process. Risks are identified, evaluated and monitored for all of the insurers at the group level.
FCCI’s Board of Directors oversees the company’s ERM practices and strategies, which includes the company’s environmental, social and governance (ESG) approach.
The Risk Officer is responsible for the implementation and oversight of the company’s ERM framework. The Risk Officer regularly reports to the Board of Directors on key risk matters, and meets quarterly with the ERM Committee to discuss risks that could have a material impact on the company.
The ERM Committee is comprised of members of the company’s Senior Management, as well as the Risk Officer and ERM team. ERM Committee members are responsible for risk evaluation, reporting and communication to key constituents of the company.
B. Senior Management is responsible for understanding relevant and material risks and ensuring risk mitigation practices are implemented throughout the organization and within their respective business units. They are responsible for assisting in identifying risk and defining a corporate risk profile, including assisting in developing risk tolerances and risk management objectives that support overall corporate goals.
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| Capital Advantage Insurance Company, Inc. | 41203 | 1230 | Y | - | 2022 | - | Capital Blue Cross | Health | The Company has an enterprise risk management (ERM) policy related to general risk. We do not presently have an ERM policy specifically related to climate change risk management. As a healthcare insurance provider, this is not a factor that we directly consider as a basis for coverage today; however, our ERM committee recognizes that the universe of risks evolves and it will therefore continue to consider and assess the need for such a policy in the future.
The Company performs a risk identification survey every 12 months to identify those items that are top tier in nature. The Company will continue to consider and assess potential risks, such as climate change, in the future and will address them as appropriate.
The Company is committed to implementing ways to recycle and conserve energy and is focused on considering energy conservation best practices in existing and future facilities and buildings, where feasible. For example:
• Lighting upgrades have been implemented, as well as changes to LED lighting. Motion sensor light switches are used throughout our buildings, and our lights are on automatic timers to conserve energy.
• When not in use, copiers go into electric time saver / sleeper mode.
• Our HVAC systems are automated and tuned for energy efficiencies. They are programmed for start and stop times that are in line with the building’s regular hours of operation.
The Company will continue to consider and implement steps in the future to address additional recycling and energy-saving efforts.
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| Farm Bureau Life Ins Co | 63096 | 67 | Y | - | 2022 | - | MICHIGAN FARM BUREAU GRP | Life | As providers of annuity and life products, the companies do not have any material climate-related risks which would impact our product offering, strategy, or financial planning. Within our organization, governance of climate-related risks and opportunities is handled at both an entity and group level. The Board of Directors for the Michigan Farm Bureau Family of Companies provides oversight to our Enterprise Risk Management (ERM) program and identified risks. While we have not established publicly stated goals pertaining to climate-related risks and opportunities, we engage in climate risk discussions during our annual risk review process. Additionally, each year the Farm Bureau Life CEO and Vice Presidents participate in a comprehensive discussion on emerging risks.
The Governance and Risk Committee of the Board of Directors is responsible for oversight of the ERM program, including climate-related risks and opportunities. The committee receives a report at least twice per year from the acting Chief Risk Officer for the organization. Any climate related risks or opportunities not previously reported would be addressed with the committee and reported to the full Board of Directors where appropriate.
Each business unit within the Michigan Farm Bureau Family of Companies has an embedded risk owner who is responsible for assessing and managing risk, including climate-related risks and opportunities. These risk discussions are held with management within the business unit and are reported to the ERM team. Business continuity plans have been developed for each unit which makes considerations for natural disasters that may impact the organization or our employees. |
| Union Insurance Company | 25844 | 98 | Y | - | 2022 | - | WR Berkley Corp GRP | Property & Casualty | Reporting Year 2022
INTRODUCTION
On behalf of the insurance companies listed below, Berkley Insurance Company (”BIC”), a Delaware domestic insurance company, as ultimate parent company of all the domestic consolidated insurance companies of W. R. Berkley Corporation (the “Company”), a Delaware corporation and the ultimate controlling parent of BIC, files this Climate Risk Disclosure Survey (“Survey”) response for the 2022 reporting year. BIC is a wholly-owned subsidiary of Signet Star Holdings, Inc., which is a wholly-owned subsidiary of the Company. The following domestic insurance companies, which represent a portion of the domestic insurers that are subsidiaries of BIC, were requested to provide a response to the Survey by one or more of the following regulatory bodies: California Department of Insurance, Connecticut Insurance Department, Delaware Department of Insurance, the District of Columbia Department of Insurance, Securities and Banking, Maine Bureau of Insurance, Maryland Insurance Administration, Massachusetts Division of Insurance, Minnesota Department of Commerce, New Mexico Office of Superintendent of Insurance, New York Department of Financial Services, Oregon Division of Financial Regulation, Pennsylvania Insurance Department, Rhode Island Division of Insurance, Vermont Department of Financial Regulation, and the Washington State Office of the Insurance Commissioner:
Acadia Insurance Company, a New Hampshire domiciled insurer; NAIC No. 0098-31325
Admiral Insurance Company, a Delaware domiciled insurer; NAIC No. 0098-24856
Berkley Insurance Company, a Delaware domiciled insurer; NAIC No. 0098-32603
Berkley Casualty Company, an Iowa domiciled insurer; NAIC No. 0098-15911
Berkley Life and Health Insurance Company, an Iowa domiciled Insurer; NAIC No. 0098-64890
Berkley National Insurance Company, an Iowa domiciled insurer; NAIC No. 0098-38911
Berkley Regional Insurance Company, a Delaware domiciled insurer; NAIC no. 0098-29580
Berkley Specialty Insurance Company, a Delaware domiciled insurer; NAIC No. 0098-31295
Carolina Casualty Insurance Company, an Iowa domiciled insurer; NAIC No. 0098-10510
Continental Western Insurance Company, an Iowa domiciled insurer; NAIC No. 0098-10804
Firemen’s Insurance Company of Washington, DC, a Delaware domiciled insurer; NAIC No. 0098-21784
Gemini Insurance Company, a Delaware domiciled insurer; NAIC No. 0098-10833
Great Divide Insurance Company, a North Dakota domiciled insurer; NAIC No. 0098-25224
Intrepid Insurance Company, an Iowa domiciled insurer; NAIC No. 0098-10749
Intrepid Casualty Company, an Iowa domiciled insurer; NAIC No. 0098-17182
Key Risk Insurance Company, an Iowa domiciled insurer; NAIC No. 0098-10885
Midwest Employers Casualty Company, a Delaware domiciled insurer; NAIC No. 0098-23612
Preferred Employers Insurance Company, a California domiciled insurer; NAIC No. 0098-10900
Riverport Insurance Company, a Minnesota domiciled insurer; NAIC No. 0098-36684
StarNet Insurance Company, a Delaware domiciled insurer; NAIC No. 0098-40045
Tri-State Insurance Company of Minnesota, an Iowa domiciled insurer; NAIC No. 0098-31003
Union Insurance Company, an Iowa domiciled insurer; NAIC No. 0098-25844
The Company’s insurance business is conducted through more than 55 operating units (collectively, “Businesses”, and individually, “Business”) that underwrite on behalf of, among others, the above-named insurance company subsidiaries, and the Company’s other non-U.S. insurance companies. Most Businesses are not legal entities. The Company and all of its insurance company subsidiaries, as noted above, and Businesses are collectively referred to as the “Group,” “Berkley,” “we,” “us,” and “our.”
The term “stakeholder” is amorphous, meaning different things to different people with its meaning further adapting to the context in which it is used. As used in this Survey, the term “stakeholder” broadly refers to any party with an interest in our operations, provided, however, such use of the term stakeholder does not imply and does not create any legal, equitable, contractual, or fiduciary right vis-à-vis any such interested party, which right does not already independently exist.
Please note that in 2022 approximately 20% of the Group’s total premiums were for property insurance and the remaining 80% of its total premiums were primarily for liability lines of insurance.
Berkley Life and Health Insurance Company (“Berkley Life”) writes health insurance and reinsurance in four primary areas: medical stop loss, managed care, special risk, and group captive. Historically, Berkley Life has not experienced any material increase in losses as a result of natural catastrophes such as hurricane, flood or tornado, nor does it currently anticipate this to occur in the future. Neither the management of Berkley Life nor the Company’s Enterprise Risk Management (“ERM”) Department has identified any link between loss frequency and/or severity in these health insurance products written by Berkley Life and such catastrophes. Consequently, although Berkley Life has full access to the Company’s research into the potential impacts of climate change, it is not currently considered an issue for Berkley Life from an insured loss perspective.
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Governance & How We Operate
Our ESG framework supports our efforts to remain flexible in the face of shifting global markets and risks. It leverages the decentralized organizational structure that is key to our success, enabling us to both universalize initiatives and tailor programs to our various Businesses. In 2022, we began developing the framework into an ESG operating model in which a multidisciplinary ESG team leads, manages, coordinates, and supports ESG efforts from an enterprise level, as overseen by W. R. Berkley Corporation’s Board of Directors (“Board”).
This team specifically leads strategy, program implementation, and ESG reporting and disclosure. As we have many distinct Businesses around the world, the ESG team also provides support for the diverse Businesses collecting and reporting data and empowers them to understand and act on the insights gained from our ESG program architecture and reporting function. The flexibility of our Businesses remains an integral component of our operating philosophy, and this model allows our initiatives to follow a common framework that can be implemented at a local level.
Moreover, we believe the continued evaluation and consideration of enterprise risk includes the examination of ESG-related risks and opportunities. Our senior officers are responsible for examining existing and potential risks as they arise in their various operational areas. Senior officers share this information among themselves and with our Enterprise Risk Management (“ERM”) department. Our Company’s Senior Vice President - Enterprise Risk Management reports on areas of material risk to Berkley, including those related to climate change. These reports are regularly provided to our ERM
management committee, our Company’s President and CEO, and the Board.
Board Oversight of ESG
The Board believes that oversight of risk, including ESG risks, is one of its key responsibilities. Our Board
and its committees receive periodic updates from management on risks, including those related to climate change, cybersecurity, human capital management (“HCM”), and overall ESG matters. Our ESG Management Committee is composed of Berkley’s President and CEO and other senior executives. The Committee meets at least quarterly and shares information with the Board regarding ESG practices and stakeholder interests. The Board, through the ESG Management Committee, guides our ESG disclosures, including the production of both our Sustainability Report and the ESG summary included in our annual proxy statement.
For more information on the Company’s risk management or the Board’s role in Risk Oversight, please see the Company’s 2023 proxy statement, located at https://d18rn0p25nwr6d.cloudfront.net/CIK-0000011544/b02c0473-270f-4d45-a80b-bf6edf5663c0.pdf
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| Triton Insurance Company | 41211 | 5021 | Y | - | 2022 | - | OneMain Holdings, Inc. | Property & Casualty | The primary nature of the products offered by the insurance company are credit insurance products which are geographically dispersed and do not present significant climate-related risks to the company. The Board of Directors and senior management have established an appropriate governance structure and ERM Framework to manage all risks, including climate-related risks. On-going efforts are being taken to reduce the carbon footprint of the company.
A. The insurance company Board of Directors and senior managers oversee management of all risks, including climate-related financial risks through its governance structure and ERM framework. The company’s investment committee is responsible for the oversight of the investment strategies employed by a third-party investment advisor. The investment advisor incorporates opportunities and risks associated with climate change into the investment process. The company uses the advisor’s tools and dashboards to assist in the climate risk oversight. The company relies on both proprietary and industry ESG ratings to assist in the monitoring of ESG risks within the portfolio.
B. On an on-going basis, management assesses and manages climate-related risks and opportunities through review of its investment portfolio and oversight of the investment advisor activities. Since the company’s products are primarily credit insurance which are not materially impacted by climate-related events, management assesses operational and financial risks as events occur. Climate risk scenarios are identified and assessed by senior managers annually during the Own Risk and Solvency Assessment (ORSA).
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| Columbia Mut Ins Co | 40371 | 807 | Y | - | 2022 | - | Columbia Insurance Group | Property & Casualty | Columbia Mutual Insurance Company (CMI) is a Missouri mutual property and casualty insurance corporation that serves as the ultimate controlling person and lead insurer of a holding company system informally known as Columbia Insurance Group.
Our Board has delegated certain functions to various Board committees that are governed by a written Charter outlining its responsibilities and reporting obligations to the Board. Our Board understands and accepts that while these committees have the authority to examine particular issues, undertake certain actions and report back to the Board on such recommendations and actions, the ultimate responsibility on all matters lies with the Board. For purposes of this Response, our Audit Committee assists our Board in fulfilling oversight responsibilities with respect to our enterprise risk management framework and related risk profile, including meeting with management to review identified risks, controls and mitigation efforts and recommending changes as appropriate.
The Board, with assistance from the Board Audit Committee and corporate Enterprise Risk Management/Investment Committee (ERM/Investment Committee), is responsible for the governance of risk by ensuring that the management teams maintains a sound system of risk management and internal controls to appropriately safeguard our policyholders’ interests and the Group’s assets, and determines the nature and extent of the significant risks which the Board is willing to take in achieving strategic objectives.
The Board has approved an Enterprise Risk Management Policy (ERM Policy) that establishes the framework for identifying, assessing, monitoring, and reporting significant risks. The primary goal of this Policy is to assess the risk appetite of the Group and to define the risk tolerance in the form of statements that quantify financial limitations. Qualitative and quantitative inputs are utilized to determine if an identified risk should be assumed, avoided, transferred, or mitigated.
The edicts of the Board as reflected in the ERM Policy are carried out by the corporate ERM/Investment Committee that is comprised of employees and members of our management team, including our Chief Risk Officer and company Investment Manager. Risks are proactively identified and addressed. The ownership of these risks lies with the respective business and corporate leaders with ultimate stewardship residing with the Board.
Weather-related risks are fully addressed by the company’s ERM program and are considered both in terms of their effect on asset management and from an underwriting perspective. The company’s ERM Risk Register outlines actions needed to best monitor the company’s exposure to severe weather events by using various risk assessment models and storm prediction reports. We continually monitor weather patterns and how they shift over time, presumably due to changes in climate. We have made deliberate efforts to diversify our book of business geographically and by line of business to remain at an acceptable risk level with regard to severe weather threats, which vary somewhat according to region and type of business. We purchase reinsurance from financially strong reinsurers at levels that help us manage exposures within our risk tolerance levels.
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| Paramount Ins Co | 11518 | - | N | - | 2022 | - | - | Health | N/A |
| Commonwealth Annuity and Life Insurance Company | 84824 | 3891 | Y | - | 2022 | - | Global Atlantic Grp | Life | Global Atlantic’s Board of Directors has delegated Environmental, Social and Governance (ESG) oversight, including the consideration of climate-related opportunities and risks, to its Nominating & Governance Committee.
Global Atlantic’s ESG Working Group has company-wide representation, including from Corporate Development, Risk, Investments, Legal, Compliance & Regulatory, Marketing, and Human Resources. The ESG Working Group is responsible for Global Atlantic’s ESG strategy, including the consideration of climate-related risks and opportunities. The ESG Working Group provides regular updates on Global Atlantic’s exposure to climate-related risks and opportunities to Global Atlantic’s Management Committee and the Nominating & Governance Committee of the Board of Directors.
Global Atlantic considers climate change-related risks as part of its overall Enterprise Risk Management Framework. Climate risk is included in Global Atlantic’s Risk Taxonomy.
Climate-related disclosure is handled at the Global Atlantic group level. For its Bermuda entities, Global Atlantic separately reports on its climate-related risks and opportunities through the Bermuda Monetary Authority’s annual climate survey.
In 2023, Global Atlantic publicly disclosed information on its corporate responsibility efforts:
Please see Global Atlantic’s 2022 Corporate Responsibility Report here (note Global Atlantic’s Sustainability Accounting Standards Board (SASB) Index can be found on pages 29 – 31) https://www.globalatlantic.com/corporateresponsibility
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| Investors Life Insurance Company of North America | 63487 | 449 | Y | - | 2022 | - | Americo Financial Life Companies | Life | The Company business primarily consists of life insurance on individuals and annuities. The company’s business is not particularly susceptible to reasonably possible climate change risks in the foreseeable future. However, climate risks are included in our overall risk management program and are reviewed by our Risk Management Committee and Board of Directors at least annually. To-date, our Board
of Directors has not identified climate risks as material risks given the nature of our business. |
| Medical Mutual Insurance Company of North Carolina | 32522 | - | N | - | 2022 | - | - | Property & Casualty | There is not a board/committee responsible for the oversight of climate-related risks and opportunities. Climate change and/or climate influenced events do not present any risks to our insurance operations or investment portfolio that we consider "greater than immaterial". |
| Group Hospitalization & Med Srvcs, Inc. | 53007 | 380 | Y | - | 2022 | - | CAREFIRST INC GRP | Health | CareFirst BlueCross BlueShield is committed to reducing energy consumption, particularly from non-renewable sources, through a variety of initiatives as described in response to question 2.
CareFirst has created an employee resource group (ERG) called the Action on Sustainability, Climate Change, and the Environment (ASCE). This ERG champions meaningful programming on environmental issues and serves as a forum for CareFirst employees interested in, and passionate about, environmental sustainability. ASCE will serve as a change agent within the organization by addressing the intersection of the healthcare industry and environmental sustainability, environmental justice, and health equity.
The company is developing an environmental sustainability roadmap to baseline the company’s emissions and create a blueprint for reducing & tracking emissions, reporting our progress, and setting goals to reduce the company’s environmental impact in the future.
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| Physicians Life Ins Co | 72125 | 367 | Y | - | 2022 | - | PHYSICIANS MUT GRP | Life | The Company has adopted an Enterprise Risk Management (ERM) framework. This Framework is used to identify, assess, monitor, and exercise control over a wide range of enterprise risks impacting the Company, including climate-related risks.
The Company has established a Corporate Risk Committee, comprised of executive management, which works directly with the various risk committees within the ERM framework to manage risks to within acceptable tolerances. The Company also has dedicated ERM leadership to provide ongoing monitoring and oversight of risks. Operational managers own the risks, monitor key risk indicators and execute controls. The Company’s Internal Audit Department is responsible for evaluating the Company’s risk mitigation actions to provide confirmation to the Company’s Board of Directors that these actions are effectively mitigating the identified risks.
Physicians Mutual does not have any publicly stated goals on climate-related risks and opportunities. Climate related disclosure is handled at the group level, under Physicians Mutual Insurance Company.
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| Markel Amer Ins Co | 28932 | - | N | - | 2022 | - | - | Property & Casualty | Markel’s approach to risk governance and accountability on the issue of climate change is comprehensive, with responsibility distributed throughout the organization at appropriate levels of management.
Markel’s leadership approach is a “forever and right now” mindset that informs day-to-day decision-making throughout the company, and reinforces our long-term commitment to the development, sustainability, and governance of Markel as one of the world’s great companies.
With this long-term framework in mind, the Markel Executive team is at the center of setting Markel’s strategic direction and determining its risk tolerance, always mindful of its responsibility to build value for our stakeholders.
Under the leadership of the Executive team’s guidance, management has taken steps to identify and anticipate climate-related risks to Markel , including quantifying risks related to climate change and our underwriting decisions related to this issue. These steps take place within the enterprise risk management (ERM) structure established by Markel.
The Risk Management Committee (RMC) is the senior management-level committee that oversees Markel’s enterprise risk management (ERM) and determines risk tolerances. In the area of climate change, the RMC is specifically tasked with monitoring how the company should strategically approach the emerging transitional and physical risks and opportunities associated with climate change, as well as the potential impact of climate change on Markel’s underwriting portfolio. Individual product line owners report to the Risk Management Committee on an annual basis; this regular reporting cycle allows Markel to adjust product offerings and pricing to more comprehensively reflect risks in our insurance portfolios.
Supporting the ERM work of the RMC is the Insurance Emerging Risks Committee (IERC), which meets quarterly. The IERC continuously scans the horizon for emerging risks and new product possibilities associated with climate change. Climate change risks are taken into consideration in specific portfolios, such as construction as an example, that may be more susceptible to third-party lawsuits arising out of extreme weather-related events related to climate change. In this context, the IERC reviews physical, transition and liability risks related to climate change.
Markel has established the Climate Change Leadership Team, which reports to the RMC and supports it in climate-related areas. The Climate Change Leadership Team comprises Risk Owners from the company’s Property, Casualty, Professional and Cyber product lines.
To help fulfill its mission, the Climate Change Leadership Team developed a climate change underwriting strategy ; compiled property, transition and liability scenarios; and explored the potential impact on Markel. It shared this strategy with the Risk Management Committee, which approved the implementation of underwriting initiatives for Markel products impacted by climate change. Having adopted this guidance, Markel can continuously:
• Enhance underwriting actions to manage the impacts of climate change;
• Modify product growth when appropriate; and
• Initiate product-specific underwriting strategies, including risk selection.
These foundational underwriting benchmarks provide the flexibility required to innovate and respond to emerging risks and opportunities.
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| Suretec Ins Co | 10916 | - | N | - | 2022 | - | - | Property & Casualty | Markel’s approach to risk governance and accountability on the issue of climate change is comprehensive, with responsibility distributed throughout the organization at appropriate levels of management.
Markel’s leadership approach is a “forever and right now” mindset that informs day-to-day decision-making throughout the company, and reinforces our long-term commitment to the development, sustainability, and governance of Markel as one of the world’s great companies.
With this long-term framework in mind, the Markel Executive team is at the center of setting Markel’s strategic direction and determining its risk tolerance, always mindful of its responsibility to build value for our stakeholders.
Under the leadership of the Executive team’s guidance, management has taken steps to identify and anticipate climate-related risks to Markel , including quantifying risks related to climate change and our underwriting decisions related to this issue. These steps take place within the enterprise risk management (ERM) structure established by Markel.
The Risk Management Committee (RMC) is the senior management-level committee that oversees Markel’s enterprise risk management (ERM) and determines risk tolerances. In the area of climate change, the RMC is specifically tasked with monitoring how the company should strategically approach the emerging transitional and physical risks and opportunities associated with climate change, as well as the potential impact of climate change on Markel’s underwriting portfolio. Individual product line owners report to the Risk Management Committee on an annual basis; this regular reporting cycle allows Markel to adjust product offerings and pricing to more comprehensively reflect risks in our insurance portfolios.
Supporting the ERM work of the RMC is the Insurance Emerging Risks Committee (IERC), which meets quarterly. The IERC continuously scans the horizon for emerging risks and new product possibilities associated with climate change. Climate change risks are taken into consideration in specific portfolios, such as construction as an example, that may be more susceptible to third-party lawsuits arising out of extreme weather-related events related to climate change. In this context, the IERC reviews physical, transition and liability risks related to climate change.
Markel has established the Climate Change Leadership Team, which reports to the RMC and supports it in climate-related areas. The Climate Change Leadership Team comprises Risk Owners from the company’s Property, Casualty, Professional and Cyber product lines.
To help fulfill its mission, the Climate Change Leadership Team developed a climate change underwriting strategy ; compiled property, transition and liability scenarios; and explored the potential impact on Markel. It shared this strategy with the Risk Management Committee, which approved the implementation of underwriting initiatives for Markel products impacted by climate change. Having adopted this guidance, Markel can continuously:
• Enhance underwriting actions to manage the impacts of climate change;
• Modify product growth when appropriate; and
• Initiate product-specific underwriting strategies, including risk selection.
These foundational underwriting benchmarks provide the flexibility required to innovate and respond to emerging risks and opportunities.
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| Civil Service Employees Insurance Company | 10693 | 323 | Y | - | 2022 | - | Combined Civil Service Employees & CSE Safeguard Ins. Co | Property & Casualty | The company does not have a formal plan that is directly related to climate-related risks and opportunities. The company is committed to complying with regulations and doing its part in preserving our environment.
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| Clover Ins Co | 86371 | - | N | - | 2022 | - | - | Health | A. Clover Insurance Company exclusively writes Medicare Advantage health insurance in select markets. As such, many operating procedures and risk analyses are performed according to the specific requirements outlined by the Centers for Medicare and Medicaid Services.
Climate-related risks are not currently a main topic of oversight by the board or its committees. However, the Company has developed an Enterprise Risk Management framework and a Risk Management Committee that meets quarterly. Environmental risk is not identified as its own key risk within the Enterprise Risk Management framework at this time. However, elements of environmental risk can be apportioned to some of the existing key risk categories in this Enterprise Risk Management Framework as the threat of climate change increases, namely Government Legislation and Policy, Member Engagement, and Revenue, Growth and Solvency. Should environmental and climate risks become incorporated into CMS and state legislation, the Company will adjust the risk profiles as needed. Clover is in the process of drafting further Business Continuity and Disaster Preparedness frameworks in addition to its ERM framework, which may more specifically address climate-related risks and mitigation.
B. The Company’s Risk Management Committee is composed of members of management and their delegates. The Risk Management Committee informs the Company’s Enterprise Risk Management Framework. Environmental risk is not identified as its own key risk within the Enterprise Risk Management framework at this time. However, elements of environmental risk are apportioned to some of the existing key risk categories, namely Government Legislation and Policy, Member Engagement, and Revenue, Growth and Solvency.
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| Progressive Michigan Insurance Company | 10187 | 155 | Y | - | 2022 | - | Progressive Insurance Group | Property & Casualty | This submission includes information from The Progressive Corporation and its subsidiaries (collectively referred to as Progressive).
Forward-Looking Information: This survey provides an overview of some of Progressive’s long-term goals and aspirations, and efforts in support of these goals and aspirations. Investors are cautioned that certain statements in this questionnaire, including those relating to our goals and aspirations, not based upon historical fact are forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. These statements often use words such as “estimate,” “expect,” “intend,” “plan,” “believe,” “goal,” “target,” “anticipate,” “will,” “could,” “likely,” “may,” “should,” and other words and terms of similar meaning, or are tied to future periods, in connection with a discussion of future operating or financial performance. Forward-looking statements are not guarantees of future performance, are based on current expectations and projections about future events, and are subject to certain risks, assumptions, and uncertainties that could cause actual events and results to differ materially from those discussed herein. For a discussion of the assumptions, risks, uncertainties, and other important factors that could cause actual events and results to differ materially from those discussed in this questionnaire, see our most recent reports and other documents filed with the United States Securities and Exchange Commission, including, without limitation, the Risk Factors section of our Annual Report on Form 10-K for the year ending December 31, 2022. Any forward-looking statements are made only as of the date presented. Except as required by applicable law, we undertake no obligation to update any forward-looking statements, whether as a result of new information, future events or developments or otherwise.
Our Board of Directors is ultimately accountable for overseeing Progressive’s risk profile and its risk management processes. To facilitate these oversight responsibilities, the Board assigns certain risk oversight to each of its main committees through each committee’s charter, which enables the Board to function more effectively. The Audit Committee oversees risks relating to financial statements, financial controls, internal and external audit functions, and external reporting. In addition, the Audit Committee oversees our Enterprise Risk Management (ERM) program which is conducted by our Management Risk Committee (MRC) and the full Board receives an update at least annually. The Nominating and Governance Committee is responsible for overseeing and addressing risks relating to the Board’s and Progressive’s governance practices, stakeholder concerns, and environmental (including climate change), and social factors and initiatives impacting us.
Our MRC coordinates risk management activities, including risk assessments and oversight of key risk-related initiatives. Several members of the MRC conduct, and all of the MRC participates in, our annual enterprise risk assessment and, with input from executive management, identifies the most critical risks facing the company. The MRC then formulates recommendations for managing identified risks and presents these recommendations to the Audit Committee for review. The MRC’s membership, comprised of members of management representing a cross-section of business units and functions, is intentionally multidisciplinary, ensuring strong risk management across Progressive. The MRC is co-chaired by our Audit Business Leader, Treasurer, and Corporate Ethics & Compliance Officer. Our Chief Financial Officer, Chief Legal Officer, and Chief Investment Officer serve as executive sponsors.
The Treasurer and Audit Business Leader provide an annual overview of the ERM program and our progress in managing key risks to the Audit Committee and the full Board of Directors. Meanwhile, our Executive Team is tasked with the annual review of the enterprise risk assessment process itself, approving and ensuring the execution of action plans that have been developed to manage, mitigate, or transfer identified enterprise risk areas, and defining strategic initiatives.
We manage climate risks through our ERM program. Our MRC is charged with understanding our climate-related risks, among other things. In the MRC’s annual risk assessment process, we evaluate the longer-term effects of climate change and attempt to evaluate the impact on capital, pricing, our customers, and investments. Because we integrate this activity into our enterprise-wide risk framework, we believe climate risk assessment and all the other risks we assess, could affect the long-term strategy of the company as we continue to react to new information and adjust our plans.
As an insurer of weather-related losses, we take a serious interest in our climate and its changes. Changing climate conditions— whether due to global climate change or other causes —may change how often severe weather events and other natural disasters occur, how long they last, how much insured damage they cause, and where the events occur. Therefore, the possibility of increasingly frequent or severe weather events is part of our risk-based pricing process. The risk management processes include climate change in its processes. Having short durations for policy periods (6 and 12 months), our claims inventory, and our investment portfolio means we can assess our risks frequently (See our 2022 Annual Report on Form 10-K and any subsequent Quarterly Reports on Form 10-Q for a full discussion of risk factors).
We believe that managing climate change-related risks can help reduce expense and offer competitive rates while maintaining our obligations to our customers. We continue to encourage greater awareness of the impact of climate change and severe weather as noted in our 2022 Corporate Sustainability Report (CSR). We report our environmental efforts to inform our stakeholders of the efforts we are making, the initiative and steps taken, and the progress made on our commitments. Our CSR describes our energy and carbon emissions management, including details on our carbon emissions reductions, our commitment to reduce our fleet’s carbon emissions, and our responsible waste management and paper reduction efforts.
This survey uses certain terms, including "material," “significant,” and other words and terms of similar meaning. Used in this context, these terms should not be confused with terms such as “material” or “materiality,” as defined by or construed in accordance with U.S. securities laws or as used in the context of U.S. GAAP financial statements and financial reporting. Also see the response below to items 3 and 4. For additional information on these topics, refer to Progressive’s 2023 Proxy Statement and 2022 CSR.
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| Manhattan Life Ins Co | 65870 | 1117 | Y | - | 2022 | - | Manhattan Life Grp | Life | We do not specifically address climate change since we do not insure property risks. However, we do address adverse
weather in our disaster recovery procedures. |
| Blue Hill Specialty Insurance Comapany Inc | 15643 | 155 | Y | - | 2022 | - | Progressive Insurance Group | Property & Casualty | This submission includes information from The Progressive Corporation and its subsidiaries (collectively referred to as Progressive).
Forward-Looking Information: This survey provides an overview of some of Progressive’s long-term goals and aspirations, and efforts in support of these goals and aspirations. Investors are cautioned that certain statements in this questionnaire, including those relating to our goals and aspirations, not based upon historical fact are forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. These statements often use words such as “estimate,” “expect,” “intend,” “plan,” “believe,” “goal,” “target,” “anticipate,” “will,” “could,” “likely,” “may,” “should,” and other words and terms of similar meaning, or are tied to future periods, in connection with a discussion of future operating or financial performance. Forward-looking statements are not guarantees of future performance, are based on current expectations and projections about future events, and are subject to certain risks, assumptions, and uncertainties that could cause actual events and results to differ materially from those discussed herein. For a discussion of the assumptions, risks, uncertainties, and other important factors that could cause actual events and results to differ materially from those discussed in this questionnaire, see our most recent reports and other documents filed with the United States Securities and Exchange Commission, including, without limitation, the Risk Factors section of our Annual Report on Form 10-K for the year ending December 31, 2022. Any forward-looking statements are made only as of the date presented. Except as required by applicable law, we undertake no obligation to update any forward-looking statements, whether as a result of new information, future events or developments or otherwise.
Our Board of Directors is ultimately accountable for overseeing Progressive’s risk profile and its risk management processes. To facilitate these oversight responsibilities, the Board assigns certain risk oversight to each of its main committees through each committee’s charter, which enables the Board to function more effectively. The Audit Committee oversees risks relating to financial statements, financial controls, internal and external audit functions, and external reporting. In addition, the Audit Committee oversees our Enterprise Risk Management (ERM) program which is conducted by our Management Risk Committee (MRC) and the full Board receives an update at least annually. The Nominating and Governance Committee is responsible for overseeing and addressing risks relating to the Board’s and Progressive’s governance practices, stakeholder concerns, and environmental (including climate change), and social factors and initiatives impacting us.
Our MRC coordinates risk management activities, including risk assessments and oversight of key risk-related initiatives. Several members of the MRC conduct, and all of the MRC participates in, our annual enterprise risk assessment and, with input from executive management, identifies the most critical risks facing the company. The MRC then formulates recommendations for managing identified risks and presents these recommendations to the Audit Committee for review. The MRC’s membership, comprised of members of management representing a cross-section of business units and functions, is intentionally multidisciplinary, ensuring strong risk management across Progressive. The MRC is co-chaired by our Audit Business Leader, Treasurer, and Corporate Ethics & Compliance Officer. Our Chief Financial Officer, Chief Legal Officer, and Chief Investment Officer serve as executive sponsors.
The Treasurer and Audit Business Leader provide an annual overview of the ERM program and our progress in managing key risks to the Audit Committee and the full Board of Directors. Meanwhile, our Executive Team is tasked with the annual review of the enterprise risk assessment process itself, approving and ensuring the execution of action plans that have been developed to manage, mitigate, or transfer identified enterprise risk areas, and defining strategic initiatives.
We manage climate risks through our ERM program. Our MRC is charged with understanding our climate-related risks, among other things. In the MRC’s annual risk assessment process, we evaluate the longer-term effects of climate change and attempt to evaluate the impact on capital, pricing, our customers, and investments. Because we integrate this activity into our enterprise-wide risk framework, we believe climate risk assessment and all the other risks we assess, could affect the long-term strategy of the company as we continue to react to new information and adjust our plans.
As an insurer of weather-related losses, we take a serious interest in our climate and its changes. Changing climate conditions— whether due to global climate change or other causes —may change how often severe weather events and other natural disasters occur, how long they last, how much insured damage they cause, and where the events occur. Therefore, the possibility of increasingly frequent or severe weather events is part of our risk-based pricing process. The risk management processes include climate change in its processes. Having short durations for policy periods (6 and 12 months), our claims inventory, and our investment portfolio means we can assess our risks frequently (See our 2022 Annual Report on Form 10-K and any subsequent Quarterly Reports on Form 10-Q for a full discussion of risk factors).
We believe that managing climate change-related risks can help reduce expense and offer competitive rates while maintaining our obligations to our customers. We continue to encourage greater awareness of the impact of climate change and severe weather as noted in our 2022 Corporate Sustainability Report (CSR). We report our environmental efforts to inform our stakeholders of the efforts we are making, the initiative and steps taken, and the progress made on our commitments. Our CSR describes our energy and carbon emissions management, including details on our carbon emissions reductions, our commitment to reduce our fleet’s carbon emissions, and our responsible waste management and paper reduction efforts.
This survey uses certain terms, including "material," “significant,” and other words and terms of similar meaning. Used in this context, these terms should not be confused with terms such as “material” or “materiality,” as defined by or construed in accordance with U.S. securities laws or as used in the context of U.S. GAAP financial statements and financial reporting. Also see the response below to items 3 and 4. For additional information on these topics, refer to Progressive’s 2023 Proxy Statement and 2022 CSR.
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| Mass General Brigham Health Plan Inc. | 11109 | - | N | - | 2022 | - | - | Health | Building on a legacy of environmental stewardship, Mass General Brigham Health Plan’s parent, Mass General Brigham, Inc. has broadened the scope of its work related to climate, health, and health care delivery and has established a governance structure for overseeing these efforts.
Mass General Brigham Health Plan Inc. (MGBHP) is a part of Mass General Brigham Incorporated (MGBI) which has established the Climate and Sustainability Leadership Council chaired by MGBI’s Chief Financial Officer and comprised of executive leadership from across all organizational areas. This Council is responsible for organizing a strategy to achieve goals in three principal areas: eliminating our contribution to climate change and pollution, promoting health equity through environmental justice, and transforming climate and sustainability through research and education.
At this time, MGBHP is participating in the health equity work of the Council.
Mass General Brigham Incorporated (“MGBI”) is the ultimate controlling parent of the Mass General Brigham Health Plan Companies (together MGBHP) which includes Mass General Brigham Health Plan Holding Company, Inc. (“Holding Company”), Mass General Brigham Health Insurance Company, Mass General Brigham Health Plan, Inc. (Mass General Brigham Health Plan) and Mass General Brigham Health Plan Select, LLC. (“Mass General Brigham Health Plan Select”).
MGBHP is part of the larger Mass General Brigham (MGBI) system. As such, governance around climate-related risks and opportunities are based on the overall system goals and answers that follow reflect initiatives, priorities, or plans of the system, except for answers that require differentiation based on payor-specific questions.
MGBI believes it is imperative to address health care facilities’ climate-related vulnerabilities in the face of extreme weather events that are increasing in frequency and severity as well as the risks these events pose for communities disproportionately affected by climate change.
a. MGBI has already conducted a comprehensive assessment of threats posed by various weather events on over 30 facilities in our system, including both impacts on infrastructure and systems and impacts on clinical operations. This exercise has led to a Climate Action Plan that outlines specific steps for ensuring continuity of operations, focusing on mitigative improvements and emergency operations plans in the short term and prioritization of climate resiliency in all future construction.
b. MGBI plans to develop systems, processes, and programs to identify and support vulnerable members of its population at greatest risk from extreme weather events.
MGBI is dedicated to educating clinical and non-clinical staff on the importance of climate change’s health impacts and sustainable health care delivery.
a. MGBI is leading other academic medical centers by formally integrating climate-health and health care sustainability into graduate medical education, hosting a monthly seminar series on intersections between environment, health, and health care delivery, and conducting regular conferences for clinical departments.
b. MGBI is a founding partner, with the Global Consortium on Climate and Health Education at Columbia University and the University of San Francisco School of Medicine, of the Climate Resources for Health Education program, a partnership to develop and disseminate tools for undergraduate and graduate medical education.
These financial risks are managed at the MGBI level.
These financial risks are managed at the MGBI level. There is no specific Climate Change Committee or Board at the insurance level. There is a Diversity, Equity, and Inclusion (DEI) Committee. Specific risks related to business continuity and insurance risk are reflected in the plan’s Enterprise Risk Management framework which is reviewed by the Executive Committee and the Board’s Audit and Committee.
As referenced above, overall climate-related risks and opportunities are managed at the MGBI level. There is no specific Climate Change Committee or Board at the insurance level. As part of our enterprise risk management framework, management reviews the impact of climate related risks on business continuity and medical trends. In addition, the health plan’s DEI Committee monitors MGBI efforts in health equity which are relevant to climate change and its impact on our members health care quality and access to care.
•Does the insurer have publicly stated goals on climate-related risks and opportunities? (Y/N) N
•Does your board have a member, members, a committee, or committees responsible for the oversight of managing the climate-related financial risk? (Y/N) N
•Does management have a role in assessing climate-related risks and opportunities? (Y/N) Y
•Does management have a role in managing climate-related risks and opportunities? (Y/N) Y
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| Empower Life & Annuity Insurance Company of New York | 79359 | - | N | - | 2022 | - | - | Life | Climate-related disclosure is handled at the parent company level through the ultimate parent company of Empower Life & Annuity Insurance Company of New York (ELAICNY), Great-West Lifeco (Lifeco). For example, Lifeco has been responding to the CDP climate change questionnaire since 2013.
ELAICNY’s ultimate parent company Lifeco is pleased to affirm its commitment to achieving net zero greenhouse gas (GHG) emissions well before 2050 in our operations and by 2050 for our financed emissions. Interim targets are currently in development and expected to be identified before year end 2023. Lifeco is hopeful its commitment drives new economic activities, generates climate resilient investment opportunities, and supports a viable transition for sectors that require transformational change to remain resilient as they respond to this global challenge. Meeting the commitment means working collaboratively with clients and advisory and investment partners to drive innovation towards a sustainable future. The immediate focus will be on developing a comprehensive transition plan, including interim targets to reduce emissions reflective of contemporary climate science.
Lifeco’s commitment is meant to include certain material operating subsidiaries, including ELAICNY. Climate risks related to ELAICNY’s operations and facilities is considered immaterial due to ELAICNY’s business model of outsourcing operations to Empower Annuity Insurance Company of America (EAICA). Therefore, activities undertaken at ELAICNY related to climate risks and opportunities apply to ELAICNY’s investment portfolio.
Internal governance around climate-related risk and opportunities occurs at both the Empower Life & Annuity Insurance Company of New York (“ELAICNY”) level and at the level of the parent company, Great-West Lifeco (“Lifeco”). The governance responsibilities within ELAICNY are outlined in a Climate Risk Policy, which was approved by the Audit Committee of the Board of Directors of ELAICNY.
The Audit Committee of the ELAICNY Board is responsible for overseeing senior management’s management of financial risks related to climate change. Specifically, the Committee oversees management’s progress toward meeting any announced climate commitments and ensures that related strategies are being employed and evaluated for effectiveness. A training on financial risks of climate change and related best practices occurred in 2022, delivered by a third-party consultant and supplemented with in-house expertise. Objectives were to:
1. Understand how climate-related risks may impact ELAICNY and the board’s role, along with senior management’s role, in managing those risks.
2. Provide leading practice examples of climate risk governance to advise and assist the board’s obligations under the NYDFS climate risk requirements.
3. Provide an overview and leading practice examples with respect to the calculation of financed emissions within the investment portfolio.
4. Provide an overview and leading practice examples with respect to how scenario analysis is used to inform business strategies and risk assessment, identification and management practices.
Topics covered include:
- Overview of the TCFD climate change risk management and disclosure framework
- How financed emissions differ to other emission categories for insurers, in terms of composition and materiality to the insurers
- Calculation of financed emissions utilizing available frameworks, data sources, approximations, and attribution factors
- Industry trends in financed emissions reporting
- Financed emissions in the context of a “net-zero” goal
- Board level focus areas
- Scenario analysis focus areas (assets, underwriting, operations)
- Scenario analysis methodologies and data
- Overview of climate change scenarios - IEA, NGFS, IPCC
- NGFS - additional details
- Quantitative vs. Qualitative scenario analysis
- Investor mitigation and adaptation strategies
- Governance considerations
- Overview of ELAICNY portfolio financed emissions, peer benchmarking, and net zero scenario application.
Plan to continue updating the Audit Committee at least annually on relevant climate metrics within the portfolio.
At the Lifeco level, the Risk Committee of the Board of Directors is responsible for, among other things, oversight of Lifeco’s enterprise risk management (including its management of sustainability risk and more specifically climate change risk). Oversight of climate-related risks is an important responsibility of the Risk Committee’s mandate, particularly given the uncertain nature of climate-related issues. The Risk Committee oversees the ERM framework and the company’s principal risks including credit, insurance, market, operational, conduct, and strategic risks. Climate change is explicitly reflected in our risk taxonomy as part of strategic risk. Oversight of risks related to climate change are an important part of the responsibility of the Risk Committee of the Board, enabling the Corporation to proactively identify and mitigate potential risks, while also considering the opportunities within Lifeco’s portfolio. The Risk Committee also reviews and approves the annual Own Risk and Solvency Assessment (ORSA Report). In Q1 2022, Lifeco added Environmental Risks as a new Emerging Risk. The company did so to separate this risk out from Climate Change Transition Impacts and to expand this new risk to both extreme events and gradual changes in environmental risks. The current and emerging risk heat maps are included in the CRO Report. The CRO Report is presented to Risk Committee quarterly by the CRO. who provides key highlights which may include current and emerging risks. At the Q3 2022 Risk Committee, a separate agenda was included on current and emerging risks.
At the Q4 2022 Risk Committee, a presentation was provided to the Risk Committee on how the climate change scenarios were updated to align with Network for Greening the Financial System (NGFS) scenarios, and how climate change is now explicitly incorporated into the strategic risk taxonomy. As a subsidiary of Lifeco, ELAICNY has adopted Lifeco’s ERM Framework.
Additionally at the Lifeco level, the Investment Committee of the Board of Directors is responsible for, among other things, climate change as part of the oversight it provides on global investment strategies, including climate-related transition risks and opportunities such as cleaner energy sectors that could impact our investment growth strategies. Oversight of climate-related impacts are an important part of the responsibility of the Investment Committee of the Board, enabling Lifeco to proactively identify and mitigate potential risks, while ensuring we maximize the opportunities within our investment portfolio. In 2022, The Lifeco Boards approved revised charters for the Boards, Audit Committees, Risk Committees, and Investment Committees to formally incorporate ESG matters. As with all responsibilities set out in the charters, the enumerated ESG responsibilities will be monitored to ensure the charters continue to reflect our evolving governance of this important area.
Regarding management’s role in assessing and managing climate-related risks and opportunities, ELAICNY operates a Three Lines of Defense (LoD) risk governance model to ensure effective management and oversight of climate risk. The following outlines key governance accountabilities for climate risk management.
First Line of Defense: (Business Units): Investment Function
The Investment Function is the ultimate owner of climate risk for ELAICNY’s investment portfolio and is primarily responsible and accountable for day-to-day climate risk management in alignment with the Risk Appetite Framework. Primary responsibility and accountability for identification, measurement, management, monitoring, and reporting of risks arising from climate change lies within the Investment Function. Within the First Line of Defense, the Chief Investment Officer (CIO) is responsible for management of climate risks.
Second Line of Defense (The Oversight Functions): Risk and Compliance Functions
The Risk and Compliance Functions are primarily responsible and accountable for ensuring that the climate risk framework is implemented and embedded, and for providing independent oversight of the climate risk management activities of the Investment Function. Within the Second Line of Defense, the Chief Risk Officer is responsible for oversight of climate risk. Additionally, the Chief Compliance Officer is responsible for establishing procedures to ensure compliance with climate-related regulations.
Third Line of Defense: Internal Audit Function
Internal Audit is an independent and objective assurance function that is responsible for independently assessing the adequacy of the design and operational effectiveness of governance, risk management, and control processes relating to climate risk management.
At the Lifeco level, management-level positions with responsibility for climate-related issues (Risks and opportunities related to our investing activities, insurance underwriting activities and own operations) include: the CEO, Chief Risk Officer, Chief Investment Officer, Deputy Chief Financial Officer, Executive Risk Management Committee, Lifeco Strategic Operating Committee, Lifeco Executive Management Committee and Chief Sustainability Officer. |
| Progressive Amer Ins Co | 24252 | 155 | Y | - | 2022 | - | Progressive Insurance Group | Property & Casualty | This submission includes information from The Progressive Corporation and its subsidiaries (collectively referred to as Progressive).
Forward-Looking Information: This survey provides an overview of some of Progressive’s long-term goals and aspirations, and efforts in support of these goals and aspirations. Investors are cautioned that certain statements in this questionnaire, including those relating to our goals and aspirations, not based upon historical fact are forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. These statements often use words such as “estimate,” “expect,” “intend,” “plan,” “believe,” “goal,” “target,” “anticipate,” “will,” “could,” “likely,” “may,” “should,” and other words and terms of similar meaning, or are tied to future periods, in connection with a discussion of future operating or financial performance. Forward-looking statements are not guarantees of future performance, are based on current expectations and projections about future events, and are subject to certain risks, assumptions, and uncertainties that could cause actual events and results to differ materially from those discussed herein. For a discussion of the assumptions, risks, uncertainties, and other important factors that could cause actual events and results to differ materially from those discussed in this questionnaire, see our most recent reports and other documents filed with the United States Securities and Exchange Commission, including, without limitation, the Risk Factors section of our Annual Report on Form 10-K for the year ending December 31, 2022. Any forward-looking statements are made only as of the date presented. Except as required by applicable law, we undertake no obligation to update any forward-looking statements, whether as a result of new information, future events or developments or otherwise.
Our Board of Directors is ultimately accountable for overseeing Progressive’s risk profile and its risk management processes. To facilitate these oversight responsibilities, the Board assigns certain risk oversight to each of its main committees through each committee’s charter, which enables the Board to function more effectively. The Audit Committee oversees risks relating to financial statements, financial controls, internal and external audit functions, and external reporting. In addition, the Audit Committee oversees our Enterprise Risk Management (ERM) program which is conducted by our Management Risk Committee (MRC) and the full Board receives an update at least annually. The Nominating and Governance Committee is responsible for overseeing and addressing risks relating to the Board’s and Progressive’s governance practices, stakeholder concerns, and environmental (including climate change), and social factors and initiatives impacting us.
Our MRC coordinates risk management activities, including risk assessments and oversight of key risk-related initiatives. Several members of the MRC conduct, and all of the MRC participates in, our annual enterprise risk assessment and, with input from executive management, identifies the most critical risks facing the company. The MRC then formulates recommendations for managing identified risks and presents these recommendations to the Audit Committee for review. The MRC’s membership, comprised of members of management representing a cross-section of business units and functions, is intentionally multidisciplinary, ensuring strong risk management across Progressive. The MRC is co-chaired by our Audit Business Leader, Treasurer, and Corporate Ethics & Compliance Officer. Our Chief Financial Officer, Chief Legal Officer, and Chief Investment Officer serve as executive sponsors.
The Treasurer and Audit Business Leader provide an annual overview of the ERM program and our progress in managing key risks to the Audit Committee and the full Board of Directors. Meanwhile, our Executive Team is tasked with the annual review of the enterprise risk assessment process itself, approving and ensuring the execution of action plans that have been developed to manage, mitigate, or transfer identified enterprise risk areas, and defining strategic initiatives.
We manage climate risks through our ERM program. Our MRC is charged with understanding our climate-related risks, among other things. In the MRC’s annual risk assessment process, we evaluate the longer-term effects of climate change and attempt to evaluate the impact on capital, pricing, our customers, and investments. Because we integrate this activity into our enterprise-wide risk framework, we believe climate risk assessment and all the other risks we assess, could affect the long-term strategy of the company as we continue to react to new information and adjust our plans.
As an insurer of weather-related losses, we take a serious interest in our climate and its changes. Changing climate conditions— whether due to global climate change or other causes —may change how often severe weather events and other natural disasters occur, how long they last, how much insured damage they cause, and where the events occur. Therefore, the possibility of increasingly frequent or severe weather events is part of our risk-based pricing process. The risk management processes include climate change in its processes. Having short durations for policy periods (6 and 12 months), our claims inventory, and our investment portfolio means we can assess our risks frequently (See our 2022 Annual Report on Form 10-K and any subsequent Quarterly Reports on Form 10-Q for a full discussion of risk factors).
We believe that managing climate change-related risks can help reduce expense and offer competitive rates while maintaining our obligations to our customers. We continue to encourage greater awareness of the impact of climate change and severe weather as noted in our 2022 Corporate Sustainability Report (CSR). We report our environmental efforts to inform our stakeholders of the efforts we are making, the initiative and steps taken, and the progress made on our commitments. Our CSR describes our energy and carbon emissions management, including details on our carbon emissions reductions, our commitment to reduce our fleet’s carbon emissions, and our responsible waste management and paper reduction efforts.
This survey uses certain terms, including "material," “significant,” and other words and terms of similar meaning. Used in this context, these terms should not be confused with terms such as “material” or “materiality,” as defined by or construed in accordance with U.S. securities laws or as used in the context of U.S. GAAP financial statements and financial reporting. Also see the response below to items 3 and 4. For additional information on these topics, refer to Progressive’s 2023 Proxy Statement and 2022 CSR.
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| Illinois EMCASCO Insurance Company | 32808 | 62 | Y | - | 2022 | - | EMC Insurance Companies | Property & Casualty | EMC's Board of Directors, through its Enterprise Risk Management Committee ("ERM Committee"), is responsible for oversight of the strategies, processes and controls relating to EMC's risk management policies and procedures to ensure that top enterprise risks and emerging risks are identified, prioritized and managed based on sound risk management principles. Climate-related risks are embedded within those various risks overseen by the ERM Committee. The ERM Committee oversees these risks at a group level, such that the oversight extends to the overall enterprise consisting of multiple companies in the EMC company structure. The ERM Committee assists the Board in overseeing the operational activities of the Company and the identification and review of risks that could have a material impact on EMC. It meets on a quarterly basis with the Enterprise Risk Officer and key members of management and, as appropriate, risk senior leaders and risk owners to discuss these risks. The ERM Committee, in turn, reports to the full Board with regard to its discussions. EMC's Board of Directors also has an Investment Committee, which is responsible for oversight of EMC's asset management strategies, including the potential impact of climate-related risks on the investment portfolio and investment strategies.
In addition to the ERM Committee, EMC utilizes a management-level enterprise risk committee called the ERM Oversight Committee, which consists of EMC's executive team, EMC's Enterprise Risk Officer, and other management-level team members. The Enterprise Risk Management (ERM) Oversight Committee exists to approve and oversee EMC's ERM framework and the processes used to identify, evaluate and manage risks faced by the organization, to ensure that risks are managed holistically and within defined tolerances, and to provide a discussion forum for top enterprise risk owners. Climate-related risks are embedded within those various risks overseen by the ERM Oversight Committee.
Additional management-level risk committees are key elements of EMC's ERM structure and help establish and reinforce its strong culture of risk management, including with respect to climate-related risks. This includes EMC's Operational Risk Committee and Catastrophe Management Committee ("CAT Committee"), both of which are tasked with reporting up through the ERM Oversight Committee. EMC also maintains an Environmental, Social and Governance Committee ("ESG Committee") that is a cross-functional committee made up of subject matter experts in various areas of EMC. The ESG Committee coordinates and supports climate-related initiatives and strategies across EMC, assists in the oversight of various ESG risks including those related to environmental components such as climate-related risks, and is a venue to share information and leverage expertise regarding varied business operations and the impact of changing climate conditions on those business operations.
EMC currently does not have any publicly stated goals on climate-related risks and opportunities.
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| Renaissance Life & Health Insurance Company of America | 61700 | - | N | - | 2022 | - | - | Health | The Company's climate-related disclosure is handled at the entity level. The Company's board of Directors, together with the Audit, Finance and Risk Management Committee of the Board (AFRM) are responsible for oversight of climate-related risks. The Board appointed Amy Basel, CPA, CGMA, as the Director accountable for the company’s assessment and management of the financial risks from climate change. The Board also appointed Jessica Kenworthy, the Company's chief risk officer, as the executive staff member accountable for climate-related risks. Kenworthy is responsible for assessing and reporting to the board on climate-related risks, and for embedding climate risks into the company's risk management framework. Basel is accountable for ensuring timely reporting to both the Board and AFRM Committee on said risks and for ensuring the current and forward- looking impact of climate related factors are considered when making business decisions. |
| Essent Guaranty, Inc. | 13634 | - | N | - | 2022 | - | - | Other | The Nominating, Governance and Corporate Responsibility Committee of our Board of Directors oversees our environmental and sustainability-related efforts. We seek to operate our corporate facilities in an environmentally sustainable, safe and healthy manner. We strive to be energy efficient across our facilities, utilizing energy management systems intended to reduce energy use and greenhouse gas (GHG) emissions, improve water efficiency, reduce waste to landfills and increase employee awareness. At this time Essent does not have a formal plan to assess its emissions in its operations.
• Several of our corporate facilities are outfitted with LED lights, occupancy control sensors and reflective energy saving film on the windows, among other energy conservation measures designed to reduce energy consumption.
• Green and eco-friendly landscaping, cleaning and janitorial supplies are sourced and used whenever possible to improve the health and well-being of our employees and partners and further lower our environmental impact.
• Our corporate headquarters in Radnor, Pennsylvania is Energy Star® certified as an environmentally conscious corporate headquarters.
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| Maine Community Health Options | 15077 | - | N | - | 2022 | - | - | Health | At the request of executive management, Community Health Options tracks a climate-related risk as part of the broader enterprise risk management (ERM) program. Quarterly updates on the ERM program are provided to the Audit Committee of the Board of Directors and member(s) of the management team. Community Health Options has not made public any goals related to climate-related risks and opportunities. |
| Teachers Ins & Ann Assoc Of Amer | 69345 | 1216 | Y | - | 2022 | - | The TIAA Family of Companies | Life | Governance – closed ended questions answered in addition to the narrative
• Does the insurer have publicly stated goals on climate-related risks and opportunities? (Y/N) Yes
• Does your board have a member, members, a committee, or committees responsible for the oversight of managing the climate-related financial risk? (Y/N) Yes
• Does management have a role in assessing climate-related risks and opportunities? (Y/N) Yes
• Does management have a role in managing climate-related risks and opportunities? (Y/N) Yes
TIAA’s commitment to addressing climate-related risks starts at the top with our Board members and leaders setting strategy and overseeing progress.
Climate-related risks have the potential to impact many risk areas, including finances, compliance and regulatory, operations, reputation, and strategy. Leveraging existing risk management frameworks, we seek to identify and assess climate risks in these categories and present any significant risks to the board and management committees.
Board Oversight: The TIAA Board of Trustees oversees the design and implementation of the TIAA climate risk strategy and delegates oversight of certain climate-risk related issues to its standing committees as set forth in their respective charters.
Board Committees
• TIAA Risk and Compliance Committee (RCC): Oversees the climate risk framework
• Investment Committee (IC): Oversees investment activity, investment policies, and strategies for the company’s General Account (GA)
• Corporate Governance and Social Responsibility Committee (CGSR): Oversees the enterprise sustainability approach
Management Committees
• Enterprise Risk Management and Compliance Committee (ERMC): Oversees the climate risk framework and monitors the company’s climate risk profile across the risk universe
• Asset Liability Committee (ALCO): Provides management oversight of any climate-related investment risk (such as credit and market risks)
• Enterprise Risk Management and Compliance Governance Committee (ERCG): Oversees implementation of the climate risk framework, reporting of the company’s climate risk profile, and review of recommendations and status related to governance
Organizational structure: From an operational standpoint, there are clear roles for designated senior leaders with accountability for climate risk initiatives.
Legal, Risk & Compliance:
• Approve and maintain policy with board governance requirements
• Develop second line of defense oversight and monitoring to identify, measure, monitor and report climate risk
• Incorporate ESG and related climate requirements into global marketing and communications review process
• Execute compliance testing for portfolio selection criteria and methodology
• Coordinate and respond to regulatory inquiries
• Provide advice and guidance relating to regulatory requirements and developments
• Monitor adherence to climate commitments and related memberships
Risk Management:
• Oversee portfolio return and risk metrics from investment decisions
• Oversee and advise on the design and execution of the net zero framework
Risk Data Analytics and Infrastructure:
• Develop centralized climate risk data infrastructure supporting analysis and reporting
TIAA General Account:
• Set, manage, and oversee execution and achievement of interim and net zero by 2050 targets for the GA
Nuveen Responsible Investing/Investing Teams:
• Advise, guide, and coordinate the full spectrum of efforts to assist the TIAA GA organization with implementation of the TIAA GA’s net zero target
Corporate Operations:
• Develop carbon reduction pathways and interim targets to attain net zero by 2040 for TIAA’s operational carbon emissions
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| Toyota Motor Ins Co | 37621 | - | N | - | 2022 | - | - | Property & Casualty | Toyota Motor Insurance Company, including its parent company and affiliates (collectively, “Toyota”), is always innovating, continuously improving, and thinking big and boldly, all to go beyond minimizing negative impacts and bring us closer to creating a net positive impact on the planet and society. Toyota’s Sustainability and Regulatory Affairs (SRA) division handles product environmental and safety regulation, energy and climate research, environmental sustainability, enterprise chemical management, and engine certification and compliance. Separately, Toyota’s Environmental & Facilities (E&F) division handles facility environmental and safety regulatory compliance.
The Environmental Sustainability (ES) group within SRA is responsible for developing short-, medium- and long-term sustainability strategies for Toyota, including planning and target setting alignment with the Toyota Environmental Challenge 2050, which includes developing consolidated five-year environmental action plan goals and targets. ES is also responsible for developing the annual North American Environmental Report. ES reports progress on these activities to the North American Executive Committee (NAEC).
Representatives from these divisions also participate in focus groups that concentrate on specific environmental issues such as water or biodiversity. These focus groups report to the Environmental Sustainability Working Group and help implement environmental action plan targets, perform benchmarking and data gathering activities, and raise awareness among team members and external stakeholders.
ES facilitates an Environmental Working Group as a coordinating mechanism for Toyota. The group is comprised of environmental experts and representatives from various divisions.
• Sustainability and Regulatory Affairs
• Research and Development
• Procurement
• Corporate Communications
• Compliance and Audit
• Logistics
• Enterprise Strategy
• Real Estate Property Services
• Environmental & Facilities
• Legal
• Toyota Canada Inc. (TCI)
• Parts Supply Chain Operations
• Manufacturing Engineering Division
Goals and Targets:
Toyota’s long-term aspirations are outlined in the Toyota Environmental Challenge 2050. Mid-term milestones have also been established, as well as short-term (five-year) targets.
The Toyota Environmental Challenge 2050 (Challenge 2050) is a set of six visionary, global challenges that seek to go beyond eliminating negative environmental impacts to creating positive value for the planet and society. Toyota Motor Corporation (TMC, TMNA’s parent company headquartered in Japan) announced these six challenges in 2015 after extensive research and internal and external consultation. The challenges apply to all Toyota subsidiaries around the world.
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| United Farm Family Life Insurance Company | 69892 | - | N | - | 2022 | - | - | Life | Climate change risk is included the Company’s Enterprise Risk Management program as a potential risk; however, management does not consider such risk as significant or material. |
| Boston Medical Center Hlth Plan Inc | 13203 | - | N | - | 2022 | - | - | Health | Boston Medical Center Health Plan, Inc., d/b/a WellSense Health Plan (WellSense), is a Massachusetts non-profit, tax exempt corporation established in 1997. WellSense’s mission is to assist and support the mission of its affiliate - Boston Medical Center Corporation (BMC) - in providing and enhancing access to effective, efficient medical care among low income, underserved, disabled, elderly and other vulnerable populations. WellSense is an HMO licensed in Massachusetts and New Hampshire. Its product lines are Medicaid, Medicare and commercial products. As of July 31, 2023, it services approximately 733,000 members in both states.
BMC Health System, Inc. (Health System) is a Massachusetts non-profit, tax-exempt corporation which oversees numerous entities within its health system. Health System entities include WellSense, BMC and various other affiliates supporting the mission of the health system. The Health System is the sole corporate member of both WellSense and BMC.
BMC is a private, not-for-profit, academic medical center located in Boston, Massachusetts. As the largest safety-net provider and busiest trauma and emergency services center in New England, BMC’s mission is to provide exceptional care, without exception to all patients. Its patient population has the highest public payer mix of any acute care hospital in Massachusetts with over half of its patients receiving care funded through the state’s combined program for Medicaid and the Children’s Health Insurance Program (MassHealth) or free care (i.e. uninsured). A significant number of BMC patients are enrolled in WellSense managed care programs.
The Health System, WellSense and BMC are each governed by separate Boards of Trustees (Boards). Several Board Committees, such as the Finance Committee, Investment Committee and Audit and Compliance Committee, operate for the health system and play a role in overseeing climate-related risks and opportunities.
Finance Committee. This Committee oversees the financial management of the Health System and its various entities. As such, it reviews and recommends policies and activities that maintain and improve the financial health and integrity of the organizations, and makes recommendations on the financial aspects of major proposed programs and services, including real estate development plans. In this role, the Committee takes into consideration applicable impacts of climate risks on the health system.
Investment Committee. This Committee oversees the investment activities of the various Health System entities, including WellSense and BMC. The Health System, WellSense and BMC utilize, in general, the same investment adviser and investment managers. As such, the implications of climate related issues affect overall investment strategy. The Committee’s role includes taking climate change related considerations into account. For example, in recent revisions to the investment policies for WellSense, BMC and the Health System, it added an Environmental, Social, & Governance (ESG) Consideration section. The goal of the new section is to add an assessment of the level of ESG integration into the decision-making process of the organizations’ investment managers and resulting investment holdings. While the Committee would like to incorporate ESG considerations, it would like to ensure that investment performance is not impacted in a volatile fashion. As such, a long-term view will be incorporated into decision making.
Audit and Compliance Committee. This Committee oversees, among other functions:
• The establishment and maintenance of an Enterprise Risk Management (ERM) program. The Committee discusses the major risk exposures facing the System entities (including climate-related risks), the steps management has taken to monitor and control these exposures, and guidelines and policies to govern the risk assessment and risk management processes for the Health System entities.
• The development, communication, monitoring and review of the corporate compliance program of WellSense, BMC and other Health System entities.
In addition, WellSense has its own Risk Oversight Committee, which oversees all health plan key organizational risks under its Own Risk and Solvency Assessment (ORSA) framework. In recognition of the growing risks and opportunities of climate change and the need to monitor, assess, report on and mitigation climate risks, in 2021 WellSense added climate change to its ORSA process as one of its operational key risks. As such, WellSense monitors this risk on a quarterly basis, as further described in our annual ORSA summary report. The Audit and Compliance Committee and the WellSense Board receive updates on the ORSA monitoring activities of the Risk Oversight Committee.
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| Pennsylvania Natl Mut Cas Ins Co | 14990 | 271 | Y | - | 2022 | - | Penn National Insurance | Property & Casualty | Penn National Insurance is a regional, multi-line property/casualty insurance group writing a full line of products through approximately 1200 independent agency operations. The insurance group includes Pennsylvania National Mutual Casualty Insurance Company (Mutual), a Pennsylvania domiciled mutual property/casualty insurance company; Penn National Security Insurance Company (Security), a Pennsylvania domiciled stock insurance company; Founders Insurance Company (Founders), a New Jersey domiciled stock insurance company; and Partners Mutual Insurance Company (Partners), a Wisconsin domiciled mutual insurance company; collectively referred to as the Company for the purposes of this disclosure only.
The Company’s climate-related disclosure is handled at the group level. The Company generally oversees, assesses and manages climate-related risks and opportunities on a group-wide basis. However, the Company’s corporate risk and actuarial departments provide modeling and analysis which are based, in part, on geographic regions with varying climate risks. As such, the modeling and analysis may diverge at the entity level to the extent of the entities’ geographic variance.
Through its Enterprise Risk Management (ERM) program, the Company assesses and manages risk, including climate-related risks, at the group level. The Company’s ERM process is a comprehensive approach, coordinating the risk management activities of the Company to ensure that risk and capital management considerations permeate all aspects of corporate decision making.
The Company’s executive management team is ultimately responsible for assessing and managing climate-related risks and opportunities. The Company addresses the active and emerging risk components of climate-related risk through its risk management framework. Through this process, the Company has identified the active climate-related risks of climate change-physical risk and climate change-transition risk and the emerging climate-related risk of climate change-liability risk. (See also Risk Management section.)
As part of the Company’s ERM framework, the Board of Directors has oversight of specific risks identified as material through the ERM process. Two of the four material risks subject to board oversight, natural catastrophe and equity, are particularly sensitive to the amplifying impacts of climate-related risks. The Enterprise Risk Oversight Committee and Finance Committee each receive regular updates on the natural catastrophe and equity risks. The Governance Committee has oversight accountability for the Company’s approach to environmental, social and governance (ESG) issues.
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| Berkley Life & Health Insurance Company | 64890 | 98 | Y | - | 2022 | - | WR Berkley Corp GRP | Property & Casualty | Reporting Year 2022
INTRODUCTION
On behalf of the insurance companies listed below, Berkley Insurance Company (”BIC”), a Delaware domestic insurance company, as ultimate parent company of all the domestic consolidated insurance companies of W. R. Berkley Corporation (the “Company”), a Delaware corporation and the ultimate controlling parent of BIC, files this Climate Risk Disclosure Survey (“Survey”) response for the 2022 reporting year. BIC is a wholly-owned subsidiary of Signet Star Holdings, Inc., which is a wholly-owned subsidiary of the Company. The following domestic insurance companies, which represent a portion of the domestic insurers that are subsidiaries of BIC, were requested to provide a response to the Survey by one or more of the following regulatory bodies: California Department of Insurance, Connecticut Insurance Department, Delaware Department of Insurance, the District of Columbia Department of Insurance, Securities and Banking, Maine Bureau of Insurance, Maryland Insurance Administration, Massachusetts Division of Insurance, Minnesota Department of Commerce, New Mexico Office of Superintendent of Insurance, New York Department of Financial Services, Oregon Division of Financial Regulation, Pennsylvania Insurance Department, Rhode Island Division of Insurance, Vermont Department of Financial Regulation, and the Washington State Office of the Insurance Commissioner:
Acadia Insurance Company, a New Hampshire domiciled insurer; NAIC No. 0098-31325
Admiral Insurance Company, a Delaware domiciled insurer; NAIC No. 0098-24856
Berkley Insurance Company, a Delaware domiciled insurer; NAIC No. 0098-32603
Berkley Casualty Company, an Iowa domiciled insurer; NAIC No. 0098-15911
Berkley Life and Health Insurance Company, an Iowa domiciled Insurer; NAIC No. 0098-64890
Berkley National Insurance Company, an Iowa domiciled insurer; NAIC No. 0098-38911
Berkley Regional Insurance Company, a Delaware domiciled insurer; NAIC no. 0098-29580
Berkley Specialty Insurance Company, a Delaware domiciled insurer; NAIC No. 0098-31295
Carolina Casualty Insurance Company, an Iowa domiciled insurer; NAIC No. 0098-10510
Continental Western Insurance Company, an Iowa domiciled insurer; NAIC No. 0098-10804
Firemen’s Insurance Company of Washington, DC, a Delaware domiciled insurer; NAIC No. 0098-21784
Gemini Insurance Company, a Delaware domiciled insurer; NAIC No. 0098-10833
Great Divide Insurance Company, a North Dakota domiciled insurer; NAIC No. 0098-25224
Intrepid Insurance Company, an Iowa domiciled insurer; NAIC No. 0098-10749
Intrepid Casualty Company, an Iowa domiciled insurer; NAIC No. 0098-17182
Key Risk Insurance Company, an Iowa domiciled insurer; NAIC No. 0098-10885
Midwest Employers Casualty Company, a Delaware domiciled insurer; NAIC No. 0098-23612
Preferred Employers Insurance Company, a California domiciled insurer; NAIC No. 0098-10900
Riverport Insurance Company, a Minnesota domiciled insurer; NAIC No. 0098-36684
StarNet Insurance Company, a Delaware domiciled insurer; NAIC No. 0098-40045
Tri-State Insurance Company of Minnesota, an Iowa domiciled insurer; NAIC No. 0098-31003
Union Insurance Company, an Iowa domiciled insurer; NAIC No. 0098-25844
The Company’s insurance business is conducted through more than 55 operating units (collectively, “Businesses”, and individually, “Business”) that underwrite on behalf of, among others, the above-named insurance company subsidiaries, and the Company’s other non-U.S. insurance companies. Most Businesses are not legal entities. The Company and all of its insurance company subsidiaries, as noted above, and Businesses are collectively referred to as the “Group,” “Berkley,” “we,” “us,” and “our.”
The term “stakeholder” is amorphous, meaning different things to different people with its meaning further adapting to the context in which it is used. As used in this Survey, the term “stakeholder” broadly refers to any party with an interest in our operations, provided, however, such use of the term stakeholder does not imply and does not create any legal, equitable, contractual, or fiduciary right vis-à-vis any such interested party, which right does not already independently exist.
Please note that in 2022 approximately 20% of the Group’s total premiums were for property insurance and the remaining 80% of its total premiums were primarily for liability lines of insurance.
Berkley Life and Health Insurance Company (“Berkley Life”) writes health insurance and reinsurance in four primary areas: medical stop loss, managed care, special risk, and group captive. Historically, Berkley Life has not experienced any material increase in losses as a result of natural catastrophes such as hurricane, flood or tornado, nor does it currently anticipate this to occur in the future. Neither the management of Berkley Life nor the Company’s Enterprise Risk Management (“ERM”) Department has identified any link between loss frequency and/or severity in these health insurance products written by Berkley Life and such catastrophes. Consequently, although Berkley Life has full access to the Company’s research into the potential impacts of climate change, it is not currently considered an issue for Berkley Life from an insured loss perspective.
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Governance & How We Operate
Our ESG framework supports our efforts to remain flexible in the face of shifting global markets and risks. It leverages the decentralized organizational structure that is key to our success, enabling us to both universalize initiatives and tailor programs to our various Businesses. In 2022, we began developing the framework into an ESG operating model in which a multidisciplinary ESG team leads, manages, coordinates, and supports ESG efforts from an enterprise level, as overseen by W. R. Berkley Corporation’s Board of Directors (“Board”).
This team specifically leads strategy, program implementation, and ESG reporting and disclosure. As we have many distinct Businesses around the world, the ESG team also provides support for the diverse Businesses collecting and reporting data and empowers them to understand and act on the insights gained from our ESG program architecture and reporting function. The flexibility of our Businesses remains an integral component of our operating philosophy, and this model allows our initiatives to follow a common framework that can be implemented at a local level.
Moreover, we believe the continued evaluation and consideration of enterprise risk includes the examination of ESG-related risks and opportunities. Our senior officers are responsible for examining existing and potential risks as they arise in their various operational areas. Senior officers share this information among themselves and with our Enterprise Risk Management (“ERM”) department. Our Company’s Senior Vice President - Enterprise Risk Management reports on areas of material risk to Berkley, including those related to climate change. These reports are regularly provided to our ERM
management committee, our Company’s President and CEO, and the Board.
Board Oversight of ESG
The Board believes that oversight of risk, including ESG risks, is one of its key responsibilities. Our Board
and its committees receive periodic updates from management on risks, including those related to climate change, cybersecurity, human capital management (“HCM”), and overall ESG matters. Our ESG Management Committee is composed of Berkley’s President and CEO and other senior executives. The Committee meets at least quarterly and shares information with the Board regarding ESG practices and stakeholder interests. The Board, through the ESG Management Committee, guides our ESG disclosures, including the production of both our Sustainability Report and the ESG summary included in our annual proxy statement.
For more information on the Company’s risk management or the Board’s role in Risk Oversight, please see the Company’s 2023 proxy statement, located at https://d18rn0p25nwr6d.cloudfront.net/CIK-0000011544/b02c0473-270f-4d45-a80b-bf6edf5663c0.pdf
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| American Equity Invest Life Ins Co | 92738 | 2658 | Y | - | 2022 | - | American Equity Investment Grp | Life | The board of directors of American Equity Investment Life Holding Company and its relevant committees oversee the company’s management of material risks to the Company. The Company periodically examines risks, including any related to climate, to assess their materiality. The Company’s Risk Management function has day to day responsibility for identifying, mitigating, monitoring, and assessing material risks. Risk Management coordinates with Legal, Compliance, and the company’s senior leaders in ensuring appropriate and effective mitigating strategies are in place with respect to material risks. |
| Horace Mann Insurance Company | 22578 | 300 | Y | - | 2022 | - | HORACE MANN GRP | Property & Casualty | The Nominating and Governance Committee of the Board of Directors has responsibility for the oversight of ESG at Horace Mann. The charter states: “The Committee shall evaluate and oversee risks related to environmental and social factors and the Company’s environmental and social goals, including the vital policies and programs needed to achieve short and long-term objectives. These policies shall include, but not be limited to, the Company’s human rights statement, diversity and inclusion efforts, environmental and climate change statement, and employee health and safety procedures. Management shall prepare and present an update to the Committee on its corporate social responsibility policies and programs, including a discussion of targets, risks and objectives on an annual basis.”
Senior management’s involvement occurs through the corporate Enterprise Risk Management (ERM) Committee. The ERM has oversight of the risk management process, with each leader having ownership and accountability over certain identified key risks. The ERM Committee discusses ESG risk annually.
The Enterprise Risk Management Committee’s risk assessments and risk mitigation strategies include recommended actions to address climate change risks. These actions include:
• Managing climate risks. Our ongoing risk assessments help us improve the accuracy of our climate-related risk models, refine how we price and underwrite policies, and avoid an overconcentration of insurance coverage and investments in geographies likely to be affected by climate risk. We also have in place a conservative reinsurance program as an additional layer of protection against large property-casualty catastrophe losses. Our coverage for $25 million to $175 million of losses shares the risk with other insurance companies.
• Mitigating climate risks. Rising temperatures and changing weather patterns in recent years are widely associated with more frequent and severe weather events and natural catastrophes, leading to higher insurance claims and costs. We have a duty to ensure we are there for our customers in the event of a loss. We work every day to protect our customers’ property and help them recover from hurricanes, windstorms, hail, severe winter weather, wildfires and earthquakes. We are actively monitoring trends in the frequency and severity of events and ongoing academic research on potential future impacts of climate change on weather volatility and will consider options to adjust our views on risk as new information becomes available.
Members of the ERM Committee are responsible for updates to the Board and various Board committees on key risks and emerging risk topics.
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| Farmers Insurance Exchange | 21652 | 69 | Y | - | 2022 | - | Farmers Insurance Group | Property & Casualty | Introduction
Our response to this climate risk survey is provided on behalf of Farmers Insurance Exchange, Fire Insurance Exchange, Truck Insurance Exchange and their various subsidiaries and affiliates, including the attorney-in-fact of the Exchanges and its subsidiaries (all entities are collectively referred to herein as “Farmers”).
In recent years, direct impacts such as increased frequency and severity of precipitation events, droughts and wildfires pose risks to a wide range of individuals, businesses, and the overall economy. At Farmers, we are committed to positively impacting our employees, customers, and the communities where we work and live. We believe in proactively managing risks and maximizing opportunities by considering material environmental factors in our day-to-day business decisions.
The Boards of Governors have the ultimate oversight responsibility of Farmers’ risks. The Exchange Audit Committee, which reports to the Boards of Governors, is responsible for overseeing our Enterprise Risk Management (“ERM”) practices and ensuring alignment of risk management to the strategy so that the organization can achieve its business and financial objectives. Climate-related risks are part of the overall Environmental, Social, and Governance (“ESG”) concerns and are managed as part of Farmers ERM program. ERM is a process of coordinated risk management that encourages cooperation from all business units to manage the organization’s full range of risks. The risks in the organization are treated in a consistent manner in terms of how they are identified, assessed, managed, monitored, and reported.
The Risk and Control Committee (“RCC”) led by the Chief Risk Officer (CRO) reports risk management activities directly to the Exchange Audit Committee which then reports to the Boards of Governors. The RCC meets on a quarterly basis and discusses potential material risks to Farmers which are related, but are not limited to, the financial plan, risk appetite, underwriting, risk accumulation and concentration, catastrophe exposures, and reinsurance. The Audit Committee and the Boards of Governors meet at least four times a year.
In addition to the RCC, the ESG Leadership Council (a cross-functional committee) formulates strategy and assists in executing Farmers’ environmental and social goals, and meeting targets. Participation from the business and functional units includes Claims, Legal, External and Internal Communications, Real Estate, Talent Sustainability, Investment Management, and Product Management.
Other business level risk committees include the Exposure Management Committee which meets multiple times a year to discuss potential risks to Farmers on current catastrophe experience and potential threats in changing climate conditions.
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| Madison National Life Insurance Company | 65781 | 300 | Y | - | 2022 | - | HORACE MANN GRP | Life | The Nominating and Governance Committee of the Board of Directors has responsibility for the oversight of ESG at Horace Mann. The charter states: “The Committee shall evaluate and oversee risks related to environmental and social factors and the Company’s environmental and social goals, including the vital policies and programs needed to achieve short and long-term objectives. These policies shall include, but not be limited to, the Company’s human rights statement, diversity and inclusion efforts, environmental and climate change statement, and employee health and safety procedures. Management shall prepare and present an update to the Committee on its corporate social responsibility policies and programs, including a discussion of targets, risks and objectives on an annual basis.”
Senior management’s involvement occurs through the corporate Enterprise Risk Management (ERM) Committee. The ERM has oversight of the risk management process, with each leader having ownership and accountability over certain identified key risks. The ERM Committee discusses ESG risk annually.
The Enterprise Risk Management Committee’s risk assessments and risk mitigation strategies include recommended actions to address climate change risks. These actions include:
• Managing climate risks. Our ongoing risk assessments help us improve the accuracy of our climate-related risk models, refine how we price and underwrite policies, and avoid an overconcentration of insurance coverage and investments in geographies likely to be affected by climate risk. We also have in place a conservative reinsurance program as an additional layer of protection against large property-casualty catastrophe losses. Our coverage for $25 million to $175 million of losses shares the risk with other insurance companies.
• Mitigating climate risks. Rising temperatures and changing weather patterns in recent years are widely associated with more frequent and severe weather events and natural catastrophes, leading to higher insurance claims and costs. We have a duty to ensure we are there for our customers in the event of a loss. We work every day to protect our customers’ property and help them recover from hurricanes, windstorms, hail, severe winter weather, wildfires and earthquakes. We are actively monitoring trends in the frequency and severity of events and ongoing academic research on potential future impacts of climate change on weather volatility and will consider options to adjust our views on risk as new information becomes available.
Members of the ERM Committee are responsible for updates to the Board and various Board committees on key risks and emerging risk topics.
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| Caterpillar Insurance Company | 11255 | - | N | - | 2022 | - | - | Property & Casualty | Caterpillar Inc. (Caterpillar) works to minimize its environmental impact by focusing on energy conservation, greenhouse gas (GHG)emission reduction, water conservation and waste reduction. Caterpillar has set energy-efficiency targets in its operations since 1998 and has set GHG emission reduction targets since 2003. Caterpillar currently has operational targets for an increased reliance on alternative and renewable energy and a reduction in energy intensity and GHG emissions intensity. Caterpillar publicly reports on its progress towards this and other sustainability-related goals in its annual Sustainability Report. Caterpillar Insurance Company operates in a building that is LEED Gold Certified by the U.S. Green Building Council. |
| Fire Insurance Exchange | 21660 | 69 | Y | - | 2022 | - | Farmers Insurance Group | Property & Casualty | Introduction
Our response to this climate risk survey is provided on behalf of Farmers Insurance Exchange, Fire Insurance Exchange, Truck Insurance Exchange and their various subsidiaries and affiliates, including the attorney-in-fact of the Exchanges and its subsidiaries (all entities are collectively referred to herein as “Farmers”).
In recent years, direct impacts such as increased frequency and severity of precipitation events, droughts and wildfires pose risks to a wide range of individuals, businesses, and the overall economy. At Farmers, we are committed to positively impacting our employees, customers, and the communities where we work and live. We believe in proactively managing risks and maximizing opportunities by considering material environmental factors in our day-to-day business decisions.
The Boards of Governors have the ultimate oversight responsibility of Farmers’ risks. The Exchange Audit Committee, which reports to the Boards of Governors, is responsible for overseeing our Enterprise Risk Management (“ERM”) practices and ensuring alignment of risk management to the strategy so that the organization can achieve its business and financial objectives. Climate-related risks are part of the overall Environmental, Social, and Governance (“ESG”) concerns and are managed as part of Farmers ERM program. ERM is a process of coordinated risk management that encourages cooperation from all business units to manage the organization’s full range of risks. The risks in the organization are treated in a consistent manner in terms of how they are identified, assessed, managed, monitored, and reported.
The Risk and Control Committee (“RCC”) led by the Chief Risk Officer (CRO) reports risk management activities directly to the Exchange Audit Committee which then reports to the Boards of Governors. The RCC meets on a quarterly basis and discusses potential material risks to Farmers which are related, but are not limited to, the financial plan, risk appetite, underwriting, risk accumulation and concentration, catastrophe exposures, and reinsurance. The Audit Committee and the Boards of Governors meet at least four times a year.
In addition to the RCC, the ESG Leadership Council (a cross-functional committee) formulates strategy and assists in executing Farmers’ environmental and social goals, and meeting targets. Participation from the business and functional units includes Claims, Legal, External and Internal Communications, Real Estate, Talent Sustainability, Investment Management, and Product Management.
Other business level risk committees include the Exposure Management Committee which meets multiple times a year to discuss potential risks to Farmers on current catastrophe experience and potential threats in changing climate conditions.
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| 1842 Insurance Company | 16862 | 447 | Y | - | 2022 | - | Harford Mutual Insurance Group | Property & Casualty | Harford Mutual Insurance Group, including all of its parent and subsidiary entities [hereafter referred to as “The Group”], does not have publicly stated goals relating to climate risks and opportunities. Climate-related disclosures are handled at a group level by its Enterprise Risk Management Committee and reported to the Group’s Board of Directors.
The Group does not have a documented climate change policy for risk management and investment management. Climate change is being incorporated into the Enterprise Risk Management process and an internal ESG position paper was developed that will bring more clarity to our efforts relating to climate change.
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| Foremost Insurance Company Grand Rapids, Michigan | 11185 | 69 | Y | - | 2022 | - | Farmers Insurance Group | Property & Casualty | Introduction
Our response to this climate risk survey is provided on behalf of Farmers Insurance Exchange, Fire Insurance Exchange, Truck Insurance Exchange and their various subsidiaries and affiliates, including the attorney-in-fact of the Exchanges and its subsidiaries (all entities are collectively referred to herein as “Farmers”).
In recent years, direct impacts such as increased frequency and severity of precipitation events, droughts and wildfires pose risks to a wide range of individuals, businesses, and the overall economy. At Farmers, we are committed to positively impacting our employees, customers, and the communities where we work and live. We believe in proactively managing risks and maximizing opportunities by considering material environmental factors in our day-to-day business decisions.
The Boards of Governors have the ultimate oversight responsibility of Farmers’ risks. The Exchange Audit Committee, which reports to the Boards of Governors, is responsible for overseeing our Enterprise Risk Management (“ERM”) practices and ensuring alignment of risk management to the strategy so that the organization can achieve its business and financial objectives. Climate-related risks are part of the overall Environmental, Social, and Governance (“ESG”) concerns and are managed as part of Farmers ERM program. ERM is a process of coordinated risk management that encourages cooperation from all business units to manage the organization’s full range of risks. The risks in the organization are treated in a consistent manner in terms of how they are identified, assessed, managed, monitored, and reported.
The Risk and Control Committee (“RCC”) led by the Chief Risk Officer (CRO) reports risk management activities directly to the Exchange Audit Committee which then reports to the Boards of Governors. The RCC meets on a quarterly basis and discusses potential material risks to Farmers which are related, but are not limited to, the financial plan, risk appetite, underwriting, risk accumulation and concentration, catastrophe exposures, and reinsurance. The Audit Committee and the Boards of Governors meet at least four times a year.
In addition to the RCC, the ESG Leadership Council (a cross-functional committee) formulates strategy and assists in executing Farmers’ environmental and social goals, and meeting targets. Participation from the business and functional units includes Claims, Legal, External and Internal Communications, Real Estate, Talent Sustainability, Investment Management, and Product Management.
Other business level risk committees include the Exposure Management Committee which meets multiple times a year to discuss potential risks to Farmers on current catastrophe experience and potential threats in changing climate conditions.
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| ASI Lloyds | 11059 | 155 | Y | - | 2022 | - | Progressive Insurance Group | Property & Casualty | This submission includes information from The Progressive Corporation and its subsidiaries (collectively referred to as Progressive).
Forward-Looking Information: This survey provides an overview of some of Progressive’s long-term goals and aspirations, and efforts in support of these goals and aspirations. Investors are cautioned that certain statements in this questionnaire, including those relating to our goals and aspirations, not based upon historical fact are forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. These statements often use words such as “estimate,” “expect,” “intend,” “plan,” “believe,” “goal,” “target,” “anticipate,” “will,” “could,” “likely,” “may,” “should,” and other words and terms of similar meaning, or are tied to future periods, in connection with a discussion of future operating or financial performance. Forward-looking statements are not guarantees of future performance, are based on current expectations and projections about future events, and are subject to certain risks, assumptions, and uncertainties that could cause actual events and results to differ materially from those discussed herein. For a discussion of the assumptions, risks, uncertainties, and other important factors that could cause actual events and results to differ materially from those discussed in this questionnaire, see our most recent reports and other documents filed with the United States Securities and Exchange Commission, including, without limitation, the Risk Factors section of our Annual Report on Form 10-K for the year ending December 31, 2022. Any forward-looking statements are made only as of the date presented. Except as required by applicable law, we undertake no obligation to update any forward-looking statements, whether as a result of new information, future events or developments or otherwise.
Our Board of Directors is ultimately accountable for overseeing Progressive’s risk profile and its risk management processes. To facilitate these oversight responsibilities, the Board assigns certain risk oversight to each of its main committees through each committee’s charter, which enables the Board to function more effectively. The Audit Committee oversees risks relating to financial statements, financial controls, internal and external audit functions, and external reporting. In addition, the Audit Committee oversees our Enterprise Risk Management (ERM) program which is conducted by our Management Risk Committee (MRC) and the full Board receives an update at least annually. The Nominating and Governance Committee is responsible for overseeing and addressing risks relating to the Board’s and Progressive’s governance practices, stakeholder concerns, and environmental (including climate change), and social factors and initiatives impacting us.
Our MRC coordinates risk management activities, including risk assessments and oversight of key risk-related initiatives. Several members of the MRC conduct, and all of the MRC participates in, our annual enterprise risk assessment and, with input from executive management, identifies the most critical risks facing the company. The MRC then formulates recommendations for managing identified risks and presents these recommendations to the Audit Committee for review. The MRC’s membership, comprised of members of management representing a cross-section of business units and functions, is intentionally multidisciplinary, ensuring strong risk management across Progressive. The MRC is co-chaired by our Audit Business Leader, Treasurer, and Corporate Ethics & Compliance Officer. Our Chief Financial Officer, Chief Legal Officer, and Chief Investment Officer serve as executive sponsors.
The Treasurer and Audit Business Leader provide an annual overview of the ERM program and our progress in managing key risks to the Audit Committee and the full Board of Directors. Meanwhile, our Executive Team is tasked with the annual review of the enterprise risk assessment process itself, approving and ensuring the execution of action plans that have been developed to manage, mitigate, or transfer identified enterprise risk areas, and defining strategic initiatives.
We manage climate risks through our ERM program. Our MRC is charged with understanding our climate-related risks, among other things. In the MRC’s annual risk assessment process, we evaluate the longer-term effects of climate change and attempt to evaluate the impact on capital, pricing, our customers, and investments. Because we integrate this activity into our enterprise-wide risk framework, we believe climate risk assessment and all the other risks we assess, could affect the long-term strategy of the company as we continue to react to new information and adjust our plans.
As an insurer of weather-related losses, we take a serious interest in our climate and its changes. Changing climate conditions— whether due to global climate change or other causes —may change how often severe weather events and other natural disasters occur, how long they last, how much insured damage they cause, and where the events occur. Therefore, the possibility of increasingly frequent or severe weather events is part of our risk-based pricing process. The risk management processes include climate change in its processes. Having short durations for policy periods (6 and 12 months), our claims inventory, and our investment portfolio means we can assess our risks frequently (See our 2022 Annual Report on Form 10-K and any subsequent Quarterly Reports on Form 10-Q for a full discussion of risk factors).
We believe that managing climate change-related risks can help reduce expense and offer competitive rates while maintaining our obligations to our customers. We continue to encourage greater awareness of the impact of climate change and severe weather as noted in our 2022 Corporate Sustainability Report (CSR). We report our environmental efforts to inform our stakeholders of the efforts we are making, the initiative and steps taken, and the progress made on our commitments. Our CSR describes our energy and carbon emissions management, including details on our carbon emissions reductions, our commitment to reduce our fleet’s carbon emissions, and our responsible waste management and paper reduction efforts.
This survey uses certain terms, including "material," “significant,” and other words and terms of similar meaning. Used in this context, these terms should not be confused with terms such as “material” or “materiality,” as defined by or construed in accordance with U.S. securities laws or as used in the context of U.S. GAAP financial statements and financial reporting. Also see the response below to items 3 and 4. For additional information on these topics, refer to Progressive’s 2023 Proxy Statement and 2022 CSR.
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| Protective Ins Co | 12416 | 155 | Y | - | 2022 | - | Progressive Insurance Group | Property & Casualty | This submission includes information from The Progressive Corporation and its subsidiaries (collectively referred to as Progressive).
Forward-Looking Information: This survey provides an overview of some of Progressive’s long-term goals and aspirations, and efforts in support of these goals and aspirations. Investors are cautioned that certain statements in this questionnaire, including those relating to our goals and aspirations, not based upon historical fact are forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. These statements often use words such as “estimate,” “expect,” “intend,” “plan,” “believe,” “goal,” “target,” “anticipate,” “will,” “could,” “likely,” “may,” “should,” and other words and terms of similar meaning, or are tied to future periods, in connection with a discussion of future operating or financial performance. Forward-looking statements are not guarantees of future performance, are based on current expectations and projections about future events, and are subject to certain risks, assumptions, and uncertainties that could cause actual events and results to differ materially from those discussed herein. For a discussion of the assumptions, risks, uncertainties, and other important factors that could cause actual events and results to differ materially from those discussed in this questionnaire, see our most recent reports and other documents filed with the United States Securities and Exchange Commission, including, without limitation, the Risk Factors section of our Annual Report on Form 10-K for the year ending December 31, 2022. Any forward-looking statements are made only as of the date presented. Except as required by applicable law, we undertake no obligation to update any forward-looking statements, whether as a result of new information, future events or developments or otherwise.
Our Board of Directors is ultimately accountable for overseeing Progressive’s risk profile and its risk management processes. To facilitate these oversight responsibilities, the Board assigns certain risk oversight to each of its main committees through each committee’s charter, which enables the Board to function more effectively. The Audit Committee oversees risks relating to financial statements, financial controls, internal and external audit functions, and external reporting. In addition, the Audit Committee oversees our Enterprise Risk Management (ERM) program which is conducted by our Management Risk Committee (MRC) and the full Board receives an update at least annually. The Nominating and Governance Committee is responsible for overseeing and addressing risks relating to the Board’s and Progressive’s governance practices, stakeholder concerns, and environmental (including climate change), and social factors and initiatives impacting us.
Our MRC coordinates risk management activities, including risk assessments and oversight of key risk-related initiatives. Several members of the MRC conduct, and all of the MRC participates in, our annual enterprise risk assessment and, with input from executive management, identifies the most critical risks facing the company. The MRC then formulates recommendations for managing identified risks and presents these recommendations to the Audit Committee for review. The MRC’s membership, comprised of members of management representing a cross-section of business units and functions, is intentionally multidisciplinary, ensuring strong risk management across Progressive. The MRC is co-chaired by our Audit Business Leader, Treasurer, and Corporate Ethics & Compliance Officer. Our Chief Financial Officer, Chief Legal Officer, and Chief Investment Officer serve as executive sponsors.
The Treasurer and Audit Business Leader provide an annual overview of the ERM program and our progress in managing key risks to the Audit Committee and the full Board of Directors. Meanwhile, our Executive Team is tasked with the annual review of the enterprise risk assessment process itself, approving and ensuring the execution of action plans that have been developed to manage, mitigate, or transfer identified enterprise risk areas, and defining strategic initiatives.
We manage climate risks through our ERM program. Our MRC is charged with understanding our climate-related risks, among other things. In the MRC’s annual risk assessment process, we evaluate the longer-term effects of climate change and attempt to evaluate the impact on capital, pricing, our customers, and investments. Because we integrate this activity into our enterprise-wide risk framework, we believe climate risk assessment and all the other risks we assess, could affect the long-term strategy of the company as we continue to react to new information and adjust our plans.
As an insurer of weather-related losses, we take a serious interest in our climate and its changes. Changing climate conditions— whether due to global climate change or other causes —may change how often severe weather events and other natural disasters occur, how long they last, how much insured damage they cause, and where the events occur. Therefore, the possibility of increasingly frequent or severe weather events is part of our risk-based pricing process. The risk management processes include climate change in its processes. Having short durations for policy periods (6 and 12 months), our claims inventory, and our investment portfolio means we can assess our risks frequently (See our 2022 Annual Report on Form 10-K and any subsequent Quarterly Reports on Form 10-Q for a full discussion of risk factors).
We believe that managing climate change-related risks can help reduce expense and offer competitive rates while maintaining our obligations to our customers. We continue to encourage greater awareness of the impact of climate change and severe weather as noted in our 2022 Corporate Sustainability Report (CSR). We report our environmental efforts to inform our stakeholders of the efforts we are making, the initiative and steps taken, and the progress made on our commitments. Our CSR describes our energy and carbon emissions management, including details on our carbon emissions reductions, our commitment to reduce our fleet’s carbon emissions, and our responsible waste management and paper reduction efforts.
This survey uses certain terms, including "material," “significant,” and other words and terms of similar meaning. Used in this context, these terms should not be confused with terms such as “material” or “materiality,” as defined by or construed in accordance with U.S. securities laws or as used in the context of U.S. GAAP financial statements and financial reporting. Also see the response below to items 3 and 4. For additional information on these topics, refer to Progressive’s 2023 Proxy Statement and 2022 CSR.
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| Berkley Specialty Insurance Company | 31295 | 98 | Y | - | 2022 | - | WR Berkley Corp GRP | Property & Casualty | Reporting Year 2022
INTRODUCTION
On behalf of the insurance companies listed below, Berkley Insurance Company (”BIC”), a Delaware domestic insurance company, as ultimate parent company of all the domestic consolidated insurance companies of W. R. Berkley Corporation (the “Company”), a Delaware corporation and the ultimate controlling parent of BIC, files this Climate Risk Disclosure Survey (“Survey”) response for the 2022 reporting year. BIC is a wholly-owned subsidiary of Signet Star Holdings, Inc., which is a wholly-owned subsidiary of the Company. The following domestic insurance companies, which represent a portion of the domestic insurers that are subsidiaries of BIC, were requested to provide a response to the Survey by one or more of the following regulatory bodies: California Department of Insurance, Connecticut Insurance Department, Delaware Department of Insurance, the District of Columbia Department of Insurance, Securities and Banking, Maine Bureau of Insurance, Maryland Insurance Administration, Massachusetts Division of Insurance, Minnesota Department of Commerce, New Mexico Office of Superintendent of Insurance, New York Department of Financial Services, Oregon Division of Financial Regulation, Pennsylvania Insurance Department, Rhode Island Division of Insurance, Vermont Department of Financial Regulation, and the Washington State Office of the Insurance Commissioner:
Acadia Insurance Company, a New Hampshire domiciled insurer; NAIC No. 0098-31325
Admiral Insurance Company, a Delaware domiciled insurer; NAIC No. 0098-24856
Berkley Insurance Company, a Delaware domiciled insurer; NAIC No. 0098-32603
Berkley Casualty Company, an Iowa domiciled insurer; NAIC No. 0098-15911
Berkley Life and Health Insurance Company, an Iowa domiciled Insurer; NAIC No. 0098-64890
Berkley National Insurance Company, an Iowa domiciled insurer; NAIC No. 0098-38911
Berkley Regional Insurance Company, a Delaware domiciled insurer; NAIC no. 0098-29580
Berkley Specialty Insurance Company, a Delaware domiciled insurer; NAIC No. 0098-31295
Carolina Casualty Insurance Company, an Iowa domiciled insurer; NAIC No. 0098-10510
Continental Western Insurance Company, an Iowa domiciled insurer; NAIC No. 0098-10804
Firemen’s Insurance Company of Washington, DC, a Delaware domiciled insurer; NAIC No. 0098-21784
Gemini Insurance Company, a Delaware domiciled insurer; NAIC No. 0098-10833
Great Divide Insurance Company, a North Dakota domiciled insurer; NAIC No. 0098-25224
Intrepid Insurance Company, an Iowa domiciled insurer; NAIC No. 0098-10749
Intrepid Casualty Company, an Iowa domiciled insurer; NAIC No. 0098-17182
Key Risk Insurance Company, an Iowa domiciled insurer; NAIC No. 0098-10885
Midwest Employers Casualty Company, a Delaware domiciled insurer; NAIC No. 0098-23612
Preferred Employers Insurance Company, a California domiciled insurer; NAIC No. 0098-10900
Riverport Insurance Company, a Minnesota domiciled insurer; NAIC No. 0098-36684
StarNet Insurance Company, a Delaware domiciled insurer; NAIC No. 0098-40045
Tri-State Insurance Company of Minnesota, an Iowa domiciled insurer; NAIC No. 0098-31003
Union Insurance Company, an Iowa domiciled insurer; NAIC No. 0098-25844
The Company’s insurance business is conducted through more than 55 operating units (collectively, “Businesses”, and individually, “Business”) that underwrite on behalf of, among others, the above-named insurance company subsidiaries, and the Company’s other non-U.S. insurance companies. Most Businesses are not legal entities. The Company and all of its insurance company subsidiaries, as noted above, and Businesses are collectively referred to as the “Group,” “Berkley,” “we,” “us,” and “our.”
The term “stakeholder” is amorphous, meaning different things to different people with its meaning further adapting to the context in which it is used. As used in this Survey, the term “stakeholder” broadly refers to any party with an interest in our operations, provided, however, such use of the term stakeholder does not imply and does not create any legal, equitable, contractual, or fiduciary right vis-à-vis any such interested party, which right does not already independently exist.
Please note that in 2022 approximately 20% of the Group’s total premiums were for property insurance and the remaining 80% of its total premiums were primarily for liability lines of insurance.
Berkley Life and Health Insurance Company (“Berkley Life”) writes health insurance and reinsurance in four primary areas: medical stop loss, managed care, special risk, and group captive. Historically, Berkley Life has not experienced any material increase in losses as a result of natural catastrophes such as hurricane, flood or tornado, nor does it currently anticipate this to occur in the future. Neither the management of Berkley Life nor the Company’s Enterprise Risk Management (“ERM”) Department has identified any link between loss frequency and/or severity in these health insurance products written by Berkley Life and such catastrophes. Consequently, although Berkley Life has full access to the Company’s research into the potential impacts of climate change, it is not currently considered an issue for Berkley Life from an insured loss perspective.
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Governance & How We Operate
Our ESG framework supports our efforts to remain flexible in the face of shifting global markets and risks. It leverages the decentralized organizational structure that is key to our success, enabling us to both universalize initiatives and tailor programs to our various Businesses. In 2022, we began developing the framework into an ESG operating model in which a multidisciplinary ESG team leads, manages, coordinates, and supports ESG efforts from an enterprise level, as overseen by W. R. Berkley Corporation’s Board of Directors (“Board”).
This team specifically leads strategy, program implementation, and ESG reporting and disclosure. As we have many distinct Businesses around the world, the ESG team also provides support for the diverse Businesses collecting and reporting data and empowers them to understand and act on the insights gained from our ESG program architecture and reporting function. The flexibility of our Businesses remains an integral component of our operating philosophy, and this model allows our initiatives to follow a common framework that can be implemented at a local level.
Moreover, we believe the continued evaluation and consideration of enterprise risk includes the examination of ESG-related risks and opportunities. Our senior officers are responsible for examining existing and potential risks as they arise in their various operational areas. Senior officers share this information among themselves and with our Enterprise Risk Management (“ERM”) department. Our Company’s Senior Vice President - Enterprise Risk Management reports on areas of material risk to Berkley, including those related to climate change. These reports are regularly provided to our ERM
management committee, our Company’s President and CEO, and the Board.
Board Oversight of ESG
The Board believes that oversight of risk, including ESG risks, is one of its key responsibilities. Our Board
and its committees receive periodic updates from management on risks, including those related to climate change, cybersecurity, human capital management (“HCM”), and overall ESG matters. Our ESG Management Committee is composed of Berkley’s President and CEO and other senior executives. The Committee meets at least quarterly and shares information with the Board regarding ESG practices and stakeholder interests. The Board, through the ESG Management Committee, guides our ESG disclosures, including the production of both our Sustainability Report and the ESG summary included in our annual proxy statement.
For more information on the Company’s risk management or the Board’s role in Risk Oversight, please see the Company’s 2023 proxy statement, located at https://d18rn0p25nwr6d.cloudfront.net/CIK-0000011544/b02c0473-270f-4d45-a80b-bf6edf5663c0.pdf
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| Union Insurance Company of Providence | 21423 | 62 | Y | - | 2022 | - | EMC Insurance Companies | Property & Casualty | EMC's Board of Directors, through its Enterprise Risk Management Committee ("ERM Committee"), is responsible for oversight of the strategies, processes and controls relating to EMC's risk management policies and procedures to ensure that top enterprise risks and emerging risks are identified, prioritized and managed based on sound risk management principles. Climate-related risks are embedded within those various risks overseen by the ERM Committee. The ERM Committee oversees these risks at a group level, such that the oversight extends to the overall enterprise consisting of multiple companies in the EMC company structure. The ERM Committee assists the Board in overseeing the operational activities of the Company and the identification and review of risks that could have a material impact on EMC. It meets on a quarterly basis with the Enterprise Risk Officer and key members of management and, as appropriate, risk senior leaders and risk owners to discuss these risks. The ERM Committee, in turn, reports to the full Board with regard to its discussions. EMC's Board of Directors also has an Investment Committee, which is responsible for oversight of EMC's asset management strategies, including the potential impact of climate-related risks on the investment portfolio and investment strategies.
In addition to the ERM Committee, EMC utilizes a management-level enterprise risk committee called the ERM Oversight Committee, which consists of EMC's executive team, EMC's Enterprise Risk Officer, and other management-level team members. The Enterprise Risk Management (ERM) Oversight Committee exists to approve and oversee EMC's ERM framework and the processes used to identify, evaluate and manage risks faced by the organization, to ensure that risks are managed holistically and within defined tolerances, and to provide a discussion forum for top enterprise risk owners. Climate-related risks are embedded within those various risks overseen by the ERM Oversight Committee.
Additional management-level risk committees are key elements of EMC's ERM structure and help establish and reinforce its strong culture of risk management, including with respect to climate-related risks. This includes EMC's Operational Risk Committee and Catastrophe Management Committee ("CAT Committee"), both of which are tasked with reporting up through the ERM Oversight Committee. EMC also maintains an Environmental, Social and Governance Committee ("ESG Committee") that is a cross-functional committee made up of subject matter experts in various areas of EMC. The ESG Committee coordinates and supports climate-related initiatives and strategies across EMC, assists in the oversight of various ESG risks including those related to environmental components such as climate-related risks, and is a venue to share information and leverage expertise regarding varied business operations and the impact of changing climate conditions on those business operations.
EMC currently does not have any publicly stated goals on climate-related risks and opportunities.
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| Monroe Guaranty Insurance Company | 32506 | 474 | Y | - | 2022 | - | FCCI Insurance Group | Property & Casualty | A. Although the company does not have a written climate change policy in place, FCCI does recognize that climate change has the potential to impact our company, the risks we insure, and our investment returns. Climate-related risks are integrated within FCCI’s Enterprise Risk Management (ERM) process. Risks are identified, evaluated and monitored for all of the insurers at the group level.
FCCI’s Board of Directors oversees the company’s ERM practices and strategies, which includes the company’s environmental, social and governance (ESG) approach.
The Risk Officer is responsible for the implementation and oversight of the company’s ERM framework. The Risk Officer regularly reports to the Board of Directors on key risk matters, and meets quarterly with the ERM Committee to discuss risks that could have a material impact on the company.
The ERM Committee is comprised of members of the company’s Senior Management, as well as the Risk Officer and ERM team. ERM Committee members are responsible for risk evaluation, reporting and communication to key constituents of the company.
B. Senior Management is responsible for understanding relevant and material risks and ensuring risk mitigation practices are implemented throughout the organization and within their respective business units. They are responsible for assisting in identifying risk and defining a corporate risk profile, including assisting in developing risk tolerances and risk management objectives that support overall corporate goals.
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| High Point Property and Casualty Insurance Company | 10930 | 1227 | Y | - | 2022 | - | Palisades Group | Property & Casualty | The Plymouth Rock Company (“PRC”) and subsidiaries manage climate risk primarily at the ultimate holding company level. PRC is the indirect parent of the management company of the New Jersey domiciled insurers responding to the survey (together with such New Jersey domiciled insurers, collectively, the “Company”). The President and Chief Operating Officer of PRC is the board member designated as responsible for the oversight of climate change.
The Company’s Enterprise Risk Management Committee (“ERM Committee”) is a cross-functional, enterprise-wide committee of senior management charged with monitoring the Company’s response to climate risk. The ERM Committee’s role with respect to climate, catastrophe, climate and other risks is to facilitate risk management and to provide oversight to assure that risk management issues, including those associated with climate change, receive timely, sustained and coordinated attention.
Senior management, including those involved in Product, Actuarial, Claims, Finance, Property Management, Legal and other functions, regularly consider the impact of catastrophe and climate risks across multiple risk categories, including, but not limited to, exposure related to pricing and underwriting, claims, reinsurance, investments, liquidity and operations.
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| Progressive Specialty Ins Co | 32786 | 155 | Y | - | 2022 | - | Progressive Insurance Group | Property & Casualty | This submission includes information from The Progressive Corporation and its subsidiaries (collectively referred to as Progressive).
Forward-Looking Information: This survey provides an overview of some of Progressive’s long-term goals and aspirations, and efforts in support of these goals and aspirations. Investors are cautioned that certain statements in this questionnaire, including those relating to our goals and aspirations, not based upon historical fact are forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. These statements often use words such as “estimate,” “expect,” “intend,” “plan,” “believe,” “goal,” “target,” “anticipate,” “will,” “could,” “likely,” “may,” “should,” and other words and terms of similar meaning, or are tied to future periods, in connection with a discussion of future operating or financial performance. Forward-looking statements are not guarantees of future performance, are based on current expectations and projections about future events, and are subject to certain risks, assumptions, and uncertainties that could cause actual events and results to differ materially from those discussed herein. For a discussion of the assumptions, risks, uncertainties, and other important factors that could cause actual events and results to differ materially from those discussed in this questionnaire, see our most recent reports and other documents filed with the United States Securities and Exchange Commission, including, without limitation, the Risk Factors section of our Annual Report on Form 10-K for the year ending December 31, 2022. Any forward-looking statements are made only as of the date presented. Except as required by applicable law, we undertake no obligation to update any forward-looking statements, whether as a result of new information, future events or developments or otherwise.
Our Board of Directors is ultimately accountable for overseeing Progressive’s risk profile and its risk management processes. To facilitate these oversight responsibilities, the Board assigns certain risk oversight to each of its main committees through each committee’s charter, which enables the Board to function more effectively. The Audit Committee oversees risks relating to financial statements, financial controls, internal and external audit functions, and external reporting. In addition, the Audit Committee oversees our Enterprise Risk Management (ERM) program which is conducted by our Management Risk Committee (MRC) and the full Board receives an update at least annually. The Nominating and Governance Committee is responsible for overseeing and addressing risks relating to the Board’s and Progressive’s governance practices, stakeholder concerns, and environmental (including climate change), and social factors and initiatives impacting us.
Our MRC coordinates risk management activities, including risk assessments and oversight of key risk-related initiatives. Several members of the MRC conduct, and all of the MRC participates in, our annual enterprise risk assessment and, with input from executive management, identifies the most critical risks facing the company. The MRC then formulates recommendations for managing identified risks and presents these recommendations to the Audit Committee for review. The MRC’s membership, comprised of members of management representing a cross-section of business units and functions, is intentionally multidisciplinary, ensuring strong risk management across Progressive. The MRC is co-chaired by our Audit Business Leader, Treasurer, and Corporate Ethics & Compliance Officer. Our Chief Financial Officer, Chief Legal Officer, and Chief Investment Officer serve as executive sponsors.
The Treasurer and Audit Business Leader provide an annual overview of the ERM program and our progress in managing key risks to the Audit Committee and the full Board of Directors. Meanwhile, our Executive Team is tasked with the annual review of the enterprise risk assessment process itself, approving and ensuring the execution of action plans that have been developed to manage, mitigate, or transfer identified enterprise risk areas, and defining strategic initiatives.
We manage climate risks through our ERM program. Our MRC is charged with understanding our climate-related risks, among other things. In the MRC’s annual risk assessment process, we evaluate the longer-term effects of climate change and attempt to evaluate the impact on capital, pricing, our customers, and investments. Because we integrate this activity into our enterprise-wide risk framework, we believe climate risk assessment and all the other risks we assess, could affect the long-term strategy of the company as we continue to react to new information and adjust our plans.
As an insurer of weather-related losses, we take a serious interest in our climate and its changes. Changing climate conditions— whether due to global climate change or other causes —may change how often severe weather events and other natural disasters occur, how long they last, how much insured damage they cause, and where the events occur. Therefore, the possibility of increasingly frequent or severe weather events is part of our risk-based pricing process. The risk management processes include climate change in its processes. Having short durations for policy periods (6 and 12 months), our claims inventory, and our investment portfolio means we can assess our risks frequently (See our 2022 Annual Report on Form 10-K and any subsequent Quarterly Reports on Form 10-Q for a full discussion of risk factors).
We believe that managing climate change-related risks can help reduce expense and offer competitive rates while maintaining our obligations to our customers. We continue to encourage greater awareness of the impact of climate change and severe weather as noted in our 2022 Corporate Sustainability Report (CSR). We report our environmental efforts to inform our stakeholders of the efforts we are making, the initiative and steps taken, and the progress made on our commitments. Our CSR describes our energy and carbon emissions management, including details on our carbon emissions reductions, our commitment to reduce our fleet’s carbon emissions, and our responsible waste management and paper reduction efforts.
This survey uses certain terms, including "material," “significant,” and other words and terms of similar meaning. Used in this context, these terms should not be confused with terms such as “material” or “materiality,” as defined by or construed in accordance with U.S. securities laws or as used in the context of U.S. GAAP financial statements and financial reporting. Also see the response below to items 3 and 4. For additional information on these topics, refer to Progressive’s 2023 Proxy Statement and 2022 CSR.
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