German reinsurer Munich Re has terminated its membership in the UN-convened Net-Zero Insurance Alliance, saying managing “antitrust risks” from investing as a group of insurers is making it harder to meet its decarbonisation goals. 

Chief executive Joachim Wenning said on Friday: “In our view, the opportunities to pursue decarbonisation goals in a collective approach among insurers worldwide without exposing ourselves to material antitrust risks are so limited that it is more effective to pursue our climate ambition to reduce global warming individually.”

Munich Re declined to provide details about the antitrust risks it was facing but a spokesperson said it was not due to mistrust in peers. 

The NZIA is a group of 29 re/insurers that have committed to transition underwriting portfolios to net zero greenhouse gas emissions by 2050.  

In January, the NZIA launched its first target-setting protocol, which will help members meet their net zero targets.

Munich Re said it is still committed to its climate targets.

It said greenhouse gas emissions related to the investment portfolio will be reduced by 29% by the end of 2025, and thereafter brought down to net zero by 2050.

In the area of ​​oil and gas production and exploration, Munich Re said it is reducing its GHG emissions to net zero by 2050 across primary insurance as well as direct and facultative reinsurance business. 

First, Munich Re aims to reduce these emissions by 5% by 2025. From this month onwards, Munich Re will not insure projects involving new oil and gas fields or new midstream oil infrastructure.  

At the same time, the exposure to thermal coal in the direct and facultative insurance business will be reduced group-wide by 35% by 2025 before eliminating this exposure altogether by 2040. Munich Re said it has not insured new coal-fired power plants/mines since 2018 and no oil sands since 2019.

For its own operations, Munich Re said it has been carbon neutral since 2015 and has already reduced CO2 emissions per employee by 44% since 2009. The remaining CO2 emissions are to be reduced by a further 12% per employee by 2025, it said. By 2030, Munich Re expects to achieve netzero GHG emissions in its operations.

"Our climate commitment is unwavering. We follow scientific recommendations. To date we are decarbonising even faster than what is required to reach net zero by 2050," said Wenning.

In 2020, Munich Re joined the Net-Zero Asset Owners Alliance, a similar initiative for institutional investors that have committed to transitioning their investment portfolios to net zero GHG emissions by 2050. 

Last week, the NZAOA produced new guidance for oil and gas investments, telling its members that no new fields should be financed, built, developed, or planned. 

Munich Re’s spokesperson said the firm’s decision to quit the NZIA will not affect its membership of the NZAOA, adding: “We will continue with [the NZAOA] as antitrust risks are lower there.”