Achieving measurable outcomes with impact investments
With sustainability increasingly on the agenda, many companies are looking at the impact they have on the world – and 2023 continues to see more organisations realigning their insurance investments to those that aim to help create social and environmental impact[1].
At QBE we’re seven years into our own impact investment initiative, Premiums4Good.
Through this initiative we invest a portion of customers’ premiums into impact investments with the intention to create positive social and/or environmental outcomes alongside financial returns.
Case Study: Investments in action
Through Premiums4Good, QBE invests in 11 impact areas that help to address environmental and social needs - things like increasing renewable energy supply, reducing homelessness, and improving education in remote communities.
One of the investments we’ve made is in the Bridges Social Outcomes Fund II, supporting innovative partnerships with the aim to deliver measurable and meaningful life improvements for individuals in the UK[2].
The fund – which channels private capital, including that from Premiums4Good, towards impactful social sector organisations – has invested in ten underlying projects as of November 2022. These projects delivered 24 social outcome contracts.
“Through that fund we have worked with rough sleepers in Manchester; […] individuals with chronic illness; [and] children to turn around educational outcomes across the country.
“By working with them in a holistic way we’re able to transform their lives and [receive] the payment from the outcomes contract,” explained Michele Giddens, Co-CEO and Founding Partner, Bridges Fund Management (InsureTV Impact Investing Masterclass, June 2022).
“This investment from Premiums4Good has helped us to change the lives of tens of thousands of young people and vulnerable adults in the UK. We know it’s working because in Greater Manchester, for example, the programme has housed 90% more people that we had targeted, for half the cost of what was being achieved by other services,” continued Michele Giddens.
Another investment that QBE has made through Premiums4Good is in the European Investment Bank Climate Awareness Bond. This bond has in turn helped finance a 287-kilometre high-speed rail corridor between Portugal and Spain. Through EIB’s Climate Awareness Bond, a loan will finance the upgrading of the Navalmoral de la Mata-Plasencia-Cáceres-Mérida-Badajoz railway corridor (about 287 km) to high-speed technical standards, including increase in line speed, electrification and doubling of the existing single-track sections.
The initiative aims to stimulate the recovery after the pandemic years and will facilitate the free movement of goods and people within the EU. It is also in line with the European transport network TEN-T’s ambitions to promote decarbonisation.
Making investments with a potential social or environmental benefit is just another way QBE helps in enabling a more resilient future together.
Looking forward
We hope that Premium4Good’s reporting, investment and impact continue to grow on a broader scale. As an insurer, directing a portion of funds to impact investments is one-way we can aim to help positively impact the community.
QBE’s ambition is to grow our impact investments through Premiums4Good to USD 2 billion by 2025 and we are on track to reach this, with USD 1.6 billion invested as of December 2022.
[1] https://www.environmental-finance.com/content/focus/sustainable-transitions-the-jobs-to-be-done/articles/sustainability-will-be-key-for-insurers-in-2023-as-global-concerns-mount.html
[2] https://www.bridgesfundmanagement.com/wp-content/uploads/2022/11/BRIDGES-AR-2022_vf1.pdf
This article first appeared on 31 September 2023 in The Insurer
