How insurance companies can become trusted authorities on climate
The insurance industry was built on a simple idea: the losses of the few would be covered by the many. Climate change will create a different equation: its effects will likely be felt — and paid for — by the many.
Insurance companies have been modelling climate risk for decades, but its real-world consequences are becoming increasingly evident. In 2023, the world witnessed a record-breaking number of natural catastrophes, causing over $1bn in insurance losses, according to data from insurance broker Aon.
This context is bringing sustainability communications in the insurance sector to the fore. A 2023 Zurich survey of sustainability leaders concluded the insurance sector had a vital role to play in sharing expertise, cultivating knowledge hubs and coordinating stakeholder efforts to tackle the immediate effects of climate change.
From a communications standpoint, there are abundant opportunities to show how insurance can be part of the solution to deal with the effects of climate change.
From our experience working with clients in the insurance sector and beyond, here are our tips for building trust through an outside-in communications strategy:
1. Demonstrate how insurance is supporting climate change adaptation
Over-emphasising doom and gloom can turn audiences off. Insurers can show they are part of the solution by supporting and showcasing successful climate adaptation, mitigation and resilience efforts.
Nature-based solutions, for example, offer both real impact and compelling stories. Zurich Insurance offered one such example with its recent video showcasing its collaboration with a Brazilian NGO, Instituto Terra, which highlighted work to restore forests and improve soil quality. The video mixes stock video with real before-and-after photographs to create an authentic and visually compelling story.
2. Raise awareness about newer climate-related insurance products
Insurers are developing innovative products to address the climate crisis, and they have a significant communications opportunity to raise awareness of this work.
New products can incentivise climate-related risk prevention by offering lower premiums to policyholders who implement climate adaptation measures. Moreover, products such as parametric insurance that cover the probability of a predefined event happening, are well-suited to catastrophic events linked to climate change. In practice, these predefined events could be earthquakes, tropical cyclones, or floods where the ‘parameter’ is the magnitude, wind speed or precipitation, respectively. These “grey swan” events which are categorised as predictable, but unlikely, can include weather exacerbated by climate change, such as hail storms and tornadoes.
As the industry evolves, high-quality information sharing and awareness raising will be an increasingly important priority.
Marsh, a global insurance broker and risk manager, has created a variety of content to educate and explain the role of parametric insurance, including webinars, case studies and infographics, alongside guidance from key internal experts. The company has also created web pages that answer key questions asked on Google searches, such as “What is the difference between traditional and parametric insurance?”.
This allows it to garner top search results and demonstrate its industry-leading expertise. Creating content that answers frequently asked questions can be a good way to inform, drive web traffic, and build brand awareness.
3. Harness real footage of sustainability in action
The old adage of storytelling – show, don’t tell – has rarely been more relevant. We live in a sceptical era of overly polished corporate narratives and AI-generated visuals. As the insurance industry plays a growing role in helping to address environmental challenges, user-generated footage gathered from those working at the front line is a valuable resource for visual storytelling.
In 2020, a good news insurance story landed after an insurer paid out to cover damage to the Mesoamerican Barrier Reef which Quintana Roo’s environment secretary Efraín Villanueva Arcos described as “like water in the desert”. News outlets jumped on the opportunity to tell the story of why the policy was taken out, how it worked and how it benefited the ecosystem using first person interviews and footage from local conservationists. The story gained widespread visibility and captured people’s imagination, demonstrating there is more potential for insurers to be proactive in telling these kinds of stories themselves.
4. Engage audiences by telling local stories from real people
Local stories of real people impacted by climate change are more likely to resonate. People can struggle to comprehend human suffering caused by climate change in far-away lands. Stories from the doorstep tend to be more impactful.
In videos for British schoolchildren, Zurich Insurance produced a campaign film featuring stories of English farmers struggling to harvest and plant seeds due to climate change. This video tells the story of the “UK’s first climate change refugees” in Fairbourne, Wales and Kit Papworth, a Norfolk-based farmer, who explains how climate change is impacting his farm and farms around the UK.
5. Create sustained campaigns to promote climate risk tools
Climate risk tools can play a positive role in tackling the climate crisis. They are also a resource to build trust and raise brand visibility. Influencers are more likely to share tools that are useful to their followers, as opposed to material that is obviously self-serving.
When Marsh unveiled the launch of its ESG Risk Rating tool, the LinkedIn post generated over 400 reposts and nearly 900 reactions. Companies can also sustain interest in tools by creating a campaign around them with a mix of social and web content.
6. From social platforms to boardrooms: invest in research to influence and build trust
High-quality research on climate risk can support companies everywhere in their journey towards building their understanding of climate risk. Credible research also helps insurance companies extend their influence both on social channels and in boardrooms. Appetite for risk data is high, as demonstrated by the popularity of the World Economic Forum’s Global Risk Report, for example. The report is a cornerstone of the content calendar for the insurance industry. The 120-page report collates input from more than 1,400 academic, business, and government leaders from around the world to illustrate the risks they are predicting and prioritising over the coming years.
High quality reports can be repurposed as social animations, LinkedIn carousels, and infographics. With demand for climate data and models rising, there are opportunities to have more in-depth data and discussions about the evolution of climate risk modelling, offering the chance to position your company as an industry leader.
This kind of industry research fulfils a dual purpose. Firstly, it offers insurers the chance to grow their social following by visualising data and insights for LinkedIn and potentially securing media coverage. Secondly, it can also support risk managers, who might be current or potential customers, by producing insights that could help them wield influence and secure buy-in at a board level.
7. Nurture thought leaders across the business
Companies can build trust by showing the people behind their business. As sustainability and climate teams at many insurers grow, companies can show they are taking the topic seriously by showcasing their expertise.
Marsh regularly publishes thought leadership blogs, podcasts and commentary from senior members of its team, from across the business. Notable examples include Amy Barnes, Head of Climate and Sustainability Strategy and Nick Faull, Head of Climate & Sustainability Risk and Innovation and Randal Waters, SVP.
This is not a time for shying away from the spotlight.
Navigating the changes ahead requires insurance companies to influence and collaborate at scale. In light of this, the importance of communications in the insurance sector will keep expanding, presenting new opportunities for those proactive enough to take them.
Disclosure: Marsh and Zurich Insurance are clients of The Content Engine