Nuveen -Fri, 09/27/2024 - 12:38

The energy transition: 10 essential indicators for insurers

Insurance companies globally, whether or not they have net zero commitments, are eager to align with and prepare for the energy transition. Understanding the pace of the transition has far-reaching consequences for investment portfolios. We have identified 10 forward-looking indicators of the energy transition that relate to capital deployment, policy shifts and technological advancements. Insurers can monitor these indicators, such as electric vehicle charging stations and climate technology funding, to help build resilient, climate-aware portfolios and discover investment opportunities.

Key takeaways

Follow the money from new government policies and recognize that government investments can have a multiplier effect in private sector investments. Clean energy production, storage and transmission stand to be big beneficiaries from government incentives.
Monitor the indicators for changes in the pace of the energy transition. Rapid acceleration is possible. Fast-changing climate conditions could mobilize governments and consumers to drive a step change in the pace of the transition. This could have far-reaching economic and geopolitical implications, such as swings in commodity demand and shifting trade dynamics.
Be aware that a slow decarbonization is currently the most likely scenario, which may further accelerate climate change. For insurers, particularly property and casualty insurers with direct exposure to physical climate risk, this could lend more support to the thesis for investments in adaptation and resilience such as nature-positive strategies. More frequent and destructive climate events may also increase real estate risk and exacerbate supply chain disruptions leading to higher structural inflation.
Explore alternative financing options. Blended finance provides opportunities to invest with the benefit of government support in areas of the energy transition where capital is lacking and impact may be greatest, such as EV charger infrastructure and emerging markets.

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Nuveen is the asset manager for TIAA, one of the world’s most highly rated and financially stable insurance companies¹. We leverage our deep expertise in partnering with insurance clients to tailor capital-efficient solutions to meet complex portfolio construction needs. Our platform of $1.4 trillion in AUM² offers differentiated investments across private credit and private equity, real assets, fixed income, and responsible investing focused strategies. For more information, please visit www.nuveen.com/insurance.

1. For its stability, claims-paying ability and overall financial strength, Teachers Insurance and Annuity Association of America (TIAA) is one of only three insurers in the United States to currently hold the highest rating available to U.S. insurers from three of the four leading insurance company rating agencies: A.M. Best (A++ as of July 2025), Fitch (AAA as of August 2025), Standard & Poor’s (AA+ as of November 2025), and the second highest possible rating from Moody’s Investors Service (Aa1 rating affirmed as of February 12, 2026). There is no guarantee that current ratings will be maintained. The financial strength ratings represent a company’s ability to meet policyholders’ obligations and do not apply to variable annuities or any other product or service not fully backed by TIAA’s claims-paying ability. The ratings also do not apply to the safety or the performance of the variable accounts, which will fluctuate in value.

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Joseph Pursley, CIMA
Head of Insurance, Americas
Joseph.Pursley@Nuveen.com
445-245-1063

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