What do environmental, social, and governance (ESG) issues have to do with insurance brokers and agents? We've been thinking about this

question at Insurance Business, and here are my thoughts so far. ESG is important to brokers because it affects the businesses of their clients.

Just look at how climate change and extreme weather events, which fall under the E pillar, have affected people in the past few years.

The insurance industry has had to deal with floods, fires, windstorms, and severe convective (thunder and hail) storms happening more often and with more force around the world.

Who is the first person to get a worried phone call when a business is flooded or burned down by a wildfire? the person who sells or buys insurance.

Now, I think that brokers play a very important role in building and supporting communities that can better deal with climate change.

Brokers can do their job as advisors better if they can help their clients better manage environmental risks, which is a key part of ESG.

Just looking at climate change by itself is not a good idea, because it has huge effects on the S pillar of the ESG framework.

Too often, people from minority groups are most at risk and have the least insurance. Everyone on Earth is affected by climate change and environmental risks, not just

people who buy insurance. Brokers need to be aware of this and be proactive about how they help build resilience in their communities through insurance coverage and reducing risks.

This point is related to the larger ideas of diversity, equity, and inclusion (DE&I), which is arguably the most important part of the S pillar and is also

a very important topic for insurance brokers and agents. At Insurance Business, we talk to insurance industry leaders every week about how

important DE&I is and how much it can help a business. In general, the conclusion is that insurance agencies and brokerages with diverse teams do

better because they can attract and keep a more diverse clientele. If you ask me, it's clear as day.

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