What is ethical insurance and who are the best providers in the UK?
An ethical insurance company invests its money ethically and avoids controversial or harmful sectors. We reveal who the most and least ethical insurance providers are in the UK.
Insurance providers can offer a range of products to help you protect loved ones and possessions, including your family, pets, car, or home.
If you’re hoping to use an insurance provider that aligns with your values, seeking an ethical provider is worth considering.
We explore what you need to know and reveal the most and least ethical insurance providers.
An ethical insurance provider invests in sustainable areas, such as renewable energy.
While many insurance firms are considered ethical, many well-known ones are not.
Understanding what your unique values are and what to consider is important when choosing a provider.
The Good Shopping Guide (GSG) currently rates Arma Karma, ETA and Zixty as the most ethical insurance providers.
What is ethical insurance?
Insurance companies invest premiums from customers to help offset the impact of inflation, preserve the value of any premiums, and ensure they can pay out any claims.
According to the Association of British Insurers (ABI), the UK insurance industry manages investments of £1.8 trillion, equivalent to around a quarter of the UK’s total net worth.
Sadly, many insurance providers invest in unethical areas, such as those involved in developing weapons or those that use fossil fuels.
Ethical insurance providers, however, may invest in renewable energy or consider environmental, social, and governance (ESG) factors when considering an investment and even adopt these company wide.
It’s worth thinking about the values you hold and if an insurance provider shares these via their choice of investments.
What you should consider when looking for ethical insurance
Where an insurance company invests isn’t the only thing to watch out for. You should also examine how they operate as a business and what other ethical measures they implement.
For example, some insurance providers may have targets to help lower their environmental impact, such as Aviva, which has committed to becoming a ‘net zero’ company by 2040 by promoting sustainability and meeting certain goals.
Insurance providers that are transparent about their investments, sustainability, and progress on their company objectives (if they have any) and take good care of their employees and customers are also more likely to be deemed ethical.
You should also explore what company an insurance provider uses as an underwriter, as their values may not align with yours or the insurance provider's.
An underwriting company may not have a transparent investment policy or engage with ESG practices.
Who are the most ethical insurance providers?
If you’re looking for an ethical insurance provider, The Good Shopping Guide (GSG) lists the most and least insurance companies.
The benchmark for ethical insurance providers is a GSG score of 70, with 19 providers exceeding this.
Here are some of the most ethical insurance providers:
| Company | GSG score | Does it have a GSG accreditation? |
|---|---|---|
| Arma Karma | 100 | Yes |
| ETA | 100 | Yes |
| Zixty | 100 | Yes |
| Naturesave | 96 | Yes |
| Aviva | 92 | Yes |
| General Accident | 92 | Yes |
| Quote Me Happy | 92 | Yes |
| Hastings Direct | 89 | No |
| Urban Jungle | 83 | No |
| Ageas | 78 | No |
| Ansvar | 78 | No |
| Ecclesiastical | 78 | No |
| NFU Mutual | 78 | No |
Other insurance providers who passed the benchmark are Admiral, Budget Insurance, Dial Direct, Diamond and Jaunt Insurance, all of which scored 72.
Those with a GSG accreditation are deemed to be a trusted brand in terms of sustainability and ethical practices.
Who are the least ethical insurance providers?
Here are some of the least ethical insurance providers, according to GSG, all of which don’t have accreditation and have scores below 70:
| Company | GSG score |
|---|---|
| LV= | 18 |
| Allianz | 18 |
| AXA | 36 |
| AA | 39 |
| RAC | 41 |
| Zurich | 44 |
| The Co-operative Insurance | 46 |
| Bupa | 46 |
| Intact Insurance | 61 |
| John Lewis | 64 |
| Direct Line | 67 |
| Churchill | 67 |
The GSG scores above apply to the insurer as a company, not to a single product.
So if you're specifically looking for ethical home, car, or business insurance, a top scoring provider's rating generally holds across the range of policies it offers, check with the provider directly to confirm which of their product lines are covered.
How does the GSG decide if an insurance provider is ethical?
When deciding if an insurance provider is ethical, the GSG looks at several factors, such as:
Environmental
This examines an insurance company’s environmental reporting, including its impact and future goals.
Insurance companies with a top rating from the GSG have an environmental report dated within the last two years and many related targets, including company-wide performance targets.
Any recent involvement in harmful environmental projects that attract much criticism will result in a low rating.
People
This looks at whether an insurance company has been involved in a project in the last five years that human rights groups have widely criticised and if they have offered significant donations to a political party or organisation.
Other factors
This looks at whether the GSG accredits the insurance provider and if they consider ESG and sustainability principles with their investments and avoid unethical ones.
Another consideration is whether the brand is strongly committed to ethics and sustainability through its policies that affect the environment, people, and animals.
Need help finding the right insurance policy?
Finding the right insurance policy can be tricky, but it’s vital you make an informed decision so you can ensure you and your loved ones are protected.
An insurance broker can look at your unique circumstances and goals to find the right policy.
Unbiased can quickly match you with a qualified insurance broker who can search for the most suitable life insurance, income protection, or critical illness policy.
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