Pioneering Specialty Credit insurance solution fosters virtuous circle for the energy transition

April 21, 2023

At Allianz Trade, we know that we are at the beginning of our journey towards sustainability, but we are deeply committed to our role in the net-zero transition. In the last few years we have reinforced our in-house sustainability practice and have developed our approach to the integration of ESG criteria across our business, reflecting our responsibility towards our employees, customers, partners, and society at large. 

One of the ways in which we can support sustainability, and our customers’ growing needs and expectations in this regard, is through our products. This is why we developed our dedicated Specialty Credit solution. 

In 2020 we launched our innovative Specialty Credit solution which contributes to tackling climate change by insuring transactions that meet our ESG KPIs and investing the related premium in bonds or private equity partnerships that meet these same criteria. The Specialty Credit solution was developed with large-scale projects in renewable energy and energy efficiency, as well as recycling and water treatment, in mind. To give a concrete example, in 2021, we provided insurance cover for a project to expand and improve water supply infrastructure in an African state. Last year we insured sanitation projects in Asia and various offshore wind farms in both emerging and developed countries.

Available to all our customers, including banks, multilaterals and corporates, eligibility for our Specialty Credit solution is subject to a rigorous and bespoke environmental evaluation. 

As well as providing credit insurance to these projects, our Specialty Credit solution creates a virtuous circle, with 100% of the generated investable premium reinjected into bonds or private equity partnerships that meet our predefined ESG criteria. The investment of these premiums is fully transparent, with a certificate of investment issued by Allianz Trade Asset Management. This has the added benefit of ensuring the full traceability of the invested premium throughout the transaction tenor.

As of 2023, we have around 40+ policies, representing over 2.5 million euros of reinvested premiums. The reinvestment of premiums provides our clients with recognition for contributing to a more sustainable economy, as well as tangible results for each party involved. Enabling a virtuous value chain, in compliance with EU taxonomy, is a particularly effective way of supporting the net-zero transition. 

The financial services sector has an important role to play in meeting the Paris Climate Agreement goals. We want to contribute to a sustainability-focused mindset in the financial services sector, and a product like our Specialty Credit solution that facilitates the transition to a low-carbon economy while making business sense proves that the two can go together.  

Our product’s story has only just begun: we are confident in its potential and of the role it will play in the transition to a more sustainable economy. 

Pierre Lamourelle

Deputy Global Head of Specialty Credit
Allianz Trade