Digital Insurance Agenda

Claims Carbon Institute: supporting insurers to reach net zero emissions

Written by Roger Peverelli and Reggy de Feniks - Founders The DIA Community on Aug 29, 2022

The global insurance industry helps its customers by fixing what is broken. In that process, however, is a sizeable carbon footprint, for example, in the repairing of insured cars and properties.

Claims Carbon Institute is on a mission to support the global insurance industry in reaching net zero emissions in 2040. They help decarbonize insurance by analyzing the carbon footprint in the entire insurance value chain and determining opportunities for reducing the footprint. The Institute does this with technology offering data and insights into the journey to net-zero.

If we go back one step, there are three ways in which insurers can influence their carbon emissions. Firstly, their own operations: how much paper or electricity do they use? Secondly, their investment portfolio: do they invest in coal mining or wind craft mills? And last but not least, in claims where 40% of the emissions happen. By making a different choice, the impact can be big: think about used car parts instead of new car parts.

Claims Carbon Institute uses the insurer’s claims data and connects through APIs to external databases to give insights into emission factors, the level of emissions and how it develops over time. By combining the various sets of data, insurers can get insight into their Scope 3 GHG (greenhouse grass) emissions. This enables them to set compelling targets and track emissions in claims. Claims Carbon calculates the financial consequences of being carbon neutral at different times.

In its platform, it follows standard reporting levels, e.g. IBNR for financials and carbon claims. This is a useful tool for the ESG department and the CFO when communicating to the board, externally and internally, about target setting.

How does it work?

Claims Carbon offers a SaaS solution that combines claims data with third-party data, in accordance with trusted standards and frameworks and in line with financial reporting. It allows insurers to do simulations and set reduction targets on certain claim types.

In its solution, is possible to drill down to different products and product lines, types of cars et cetera. Carbon Emissions differ per type of car, type of claims or type of repairs. The dashboard allows for seeing the difference in the carbon footprint between repairs with used parts and new car parts. This may be specific per brand, also dependent on the availability of used car parts or agreements with white-label car parts providers.

Insurers can use the dashboard when sourcing new vendors for repairs and analysing how environmentally friendly the different vendors are. Another use case is to involve customers in deciding whether to choose a new or used carpet. This is especially useful in countries where customers are ‘educated’ to want new car parts or where insurers have requirements from the car industry. With Claims Carbon Institute’s tools, insurers can involve ESG-oriented customers, allowing them to save costs and improve their ESG footprint.

The final example is carbon-neutral insurance. What is the cost of that? Insurers will have to pay 3 to 7% more, dependent on the type of car, the type of property and claims frequency.

Why did we select Claims Carbon for DIA Amsterdam 2022?

Cutting down on Carbon Emissions in the Insurance Industry is important, not only from a “saving the world” perspective, but also for standing out in the market and for financial gains. With this solution, it is quite easy to get going with this. The amount of data that Claims Carbon Institute needs to start calculations and suggestions, is quite low and achievable.

On stage was Rune Brunborg, board member at Claim Carbon, who shared why lowering the Carbon  Footprint not only saves the planet but also saves money for insurers. He showed what their SaaS solution looks like and how insurers can determine emission targets and how to reach them. Watch the presentation here!

Who is Claims Carbon Institute?

Claims Carbon Institute was founded in 2021 and is based in Norway, Sweden, Finland and Poland. The founders are seasoned insurance executives who know how insurers operate and where opportunities are to improve the Carbon Footprint. Claims Carbon Institute currently operates in the Nordics, with customers in all Nordic countries, but has ambitions to take its business global.

Visit their website to learn more: https://claimscarbon.com/

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