BALTIMORE – Consistent with Governor Larry Hogan’s commitment to address and mitigate the effects of climate change, the State of Maryland has joined the Sustainable Insurance Forum (SIF) of the United Nations Development Program (UNDP).
The UNDP SIF is a global network of insurance regulators and financial supervisors working together to address sustainability challenges in the insurance sector. Maryland Insurance Commissioner, Kathleen A. Birrane, will serve as the principle contact for the Maryland Insurance Administration (MIA), the State’s representative to the SIF.
The SIF was established by the UNDP in December 2016 to provide an international platform for insurance supervisors to collaborate on regulatory responses to climate related financial risks and opportunities faced by the insurance sector. As the world’s risk financers and risk managers, with global invested assets exceeding the equivalent of US$36 trillion as of 2019, the insurance sector plays a pivotal role in stewarding an orderly transition to a low-carbon, resilient and sustainable global economy, both in terms of the risks it covers and the investments it makes. Maryland is the fifth U.S. state to join the SIF, following New York, California, Washington and Vermont. The National Association of Insurance Commissioners (NAIC) and the Federal Insurance Office (FIO) were also recently accepted as members. “Insurance is a $5 trillion industry. And, as with every other dimension of climate change, Maryland is playing a leading role in assuring that the insurance sector is engaged on climate issues and that insurance regulatory frameworks are appropriately adjusted to identify and account for climate-related financial risks,” said Commissioner Birrane. “Under Governor Hogan’s leadership, Maryland is truly moving the needle on addressing environmental sustainability challenges and climate-related risks at the national level and promoting adaptation and mitigation initiatives locally. Joining the SIF gives us an additional opportunity to bring Maryland’s bipartisan, science-based, collaborative approach to the discussions occurring nationally and internationally on these critically important issues.” Representing Maryland at the NAIC, Commissioner Birrane is a Vice-Chair of the Climate and Resiliency Task Force formed by the NAIC in 2020 and, in that capacity, chairs the Solvency Workstream, which is charged with considering how the financial surveillance tools used by US regulators should be adjusted to account for the financial risks arising from climate change. Internationally, Commissioner Birrane is one of three U.S. members on the Steering Committee of the E.U.-U.S. Insurance Dialogue Project -- an initiative started in 2012 to enhance cross-border cooperation and regulatory modernization to address current and emerging risks in the insurance sector. The Project’s Climate Risk and Resilience Workstreams are focused on identifying sustainability, resilience and mitigation issues and solutions related to the insurance sector, including through innovative technology and modeling. U.S. and E.U. insurance regulators oversee approximately two-thirds of the global insurance market. In Maryland, Governor Hogan has both enacted and supported numerous bipartisan laws codifying Maryland’s commitment to reduce statewide greenhouse gas emissions, to ban hydraulic fracturing, to accelerate clean energy innovations and investments in green infrastructure, and to build resilience to the impacts of climate change on the Chesapeake Bay. In 2020, the World Resources Institute ranked Maryland first among 50 states at reducing greenhouse gas emissions while growing the economy. Notable accomplishments include: - The Maryland Commission on Climate Change (MCCC) – a nationally acclaimed program, charged with advising the Governor and the General Assembly on ways to mitigate, prepare for, and adapt to climate change, was codified into law in 2015 by Governor Hogan and the General Assembly. The MIA serves as a state agency member on three of the Commission’s four Work Groups: the Adaptation and Resiliency Work Group; the Education, Communication, and Outreach Working Group; and the Mitigation Work Group.
- Three years ago, Governor Hogan joined a coalition of states in the U.S. Climate Alliance to support the Paris Climate Agreement. In 2019, the Governor signed an executive order, “Energy Savings Goals for State Government,” which seeks to produce positive environmental, fiscal, and health benefits for all Marylanders by reducing energy use and carbon emissions across the entire portfolio of state-owned buildings.
- Maryland Department of the Environment Secretary Ben Grumbles attended and participated in key events at the annual global summit on climate change known as COP26 (United Nations 26th Conference of the Parties) in Glasgow, Scotland, on November 7-10. Grumbles joined panel discussions and meetings to promote economy-wide deep decarbonization, adaptation and resiliency, highlighting Maryland’s ambitious greenhouse gas reduction and nature-based restoration and protection strategies. Commissioner Birrane also spoke at COP26, addressing the Hogan Administration’s climate initiatives and national and international regulatory efforts on assessing, managing and monitoring climate-related financial risk, focusing on the financial impact to insurers solvency.
- On November 3, Commissioner Birrane participated in a panel sponsored by the UN Environmental Programme’s Principals for Sustainable Insurance Initiative as part of its PSI COP26 Sustainable Insurance Series. The US is the world’s largest insurance market, and insurance regulation in the US is state-based. This event convened four US Insurance Commissioners (including Commissioner Birrane) to discuss how their states are taking action on climate change risks and helping build resilience, the work of the Climate & Resiliency Task Force of the US National Association of Insurance Commissioners (NAIC), as well as key topics such as climate risk disclosure by insurers and the recommendations of the Task Force on Climate-related Financial Disclosures (TCFD).
- On November 17, Governor Hogan announced Maryland as the first state in the country to become a partner in the U.S. Department of Energy’s (DOE) Better Climate Challenge. The “lead by example” partnership agreement, signed by Secretary Grumbles, commits the state to reduce greenhouse gas emissions in state government operations by at least 50% within 10 years, which aligns with the comprehensive greenhouse gas reduction plan, which has a goal of a 50% reduction from 2006 levels by 2030.
The Maryland Insurance Administration regulates the nearly 1,600 licensed insurers that are authorized to do business in the State and that generate approximately $41 billion annually in direct written premium through transactions in the State.
About the Maryland Insurance Administration
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