There Goes The Neighborhood: Lloyd’s Drops Coal Like A Hot Potato
As if 2018 isn’t beginning badly enough for the US coal industry, over the weekend word dropped that Lloyd’s of London is dropping out of the coal market. Other leading firms have already staked out their position in the low carbon economy, but losing the support of the world’s oldest and most iconic insurance company is a sure sign that the coal industry is reaching the point of no return.
The company has been slow to act compared to others in the insurance field, but it’s on the hook for $4.5 billion in payouts just for damages attributed to hurricanes Harvey and Maria alone. It seems that the cascade of climate-related catastrophes in 2017 finally provided the bottom line motivation to act.
Slow or not, this Johnny-come-lately will have an outsized impact on fossil fuel divestment. Lloyd’s isn’t really just one insurance company. It runs a marketplace-style underwriting model with more than 50 leading insurers under its umbrella.
No matter what politicians may say, businesses are making their own decision about where future returns lie.