The Guernsey Financial Services Commission has enacted amendments to the Insurance Business (Solvency) Rules 2015, proposed in October, which introduce a specific approach for green assets and help incentivise increased investment in green assets by life insurers.
The Commission's proposals included a Green Discount to encourage green, sustainable investment by life insurers and help promote positive environmental outcomes.
This would enable insurers to purchase green assets in the knowledge that long-term green assets are considered suitable to meet long-term liabilities while maintaining policyholder protection.
As a result of the changes, life insurers will now be able to apply the Green Discount in line with the amended Solvency Rules, which came into effect on 15 December.
It will remain the responsibility of each insurer to determine its approach to green assets, in line with the standard requirements relating to fiduciary duties and robust corporate governance.
Life insurers adopting this approach would be expected to adapt their policies, procedures and controls to ensure that investment in green assets is made in a prudent manner while ensuring policyholder interests continue to be protected.
• The rules can be found here