Draft Business Specifications for the Climate-Related Risk Returns for Insurers

Accompanying Documents

Document Properties

  • Type of Publication: Draft manual of reporting
  • Date: June 2023

Purpose

These returns capture data to enable quantification of Insurers’ 1) potential and realized physical risk exposures; and 2) potential transition risk exposures, as at fiscal year-end.

More specifically, these returns collect data on:

  • underwritten physical risk exposures (claims, insurance revenue and PML) for select lines of business, by geographic location
  • absolute greenhouse gas (GHG) emissions (Scopes 1, 2 and 3)

Application

These returns apply to all Insurers.

Frequency

Annual.

Filing Format

Returns are to be filed through RRS in .CSV format.

Reporting Date

The returns must be completed on a fiscal year-end basis and filed within 90 days of the fiscal year-end date.

Implementation Date

These Returns are effective for the fiscal years ending on or after October 1, 2024.

Contact Agency

Office of the Superintendent of Financial Institutions (OSFI).

Contact Person

For business and/or interpretation questions on the consultation version of the return, contact us through the Climate Risk Return email address: ClimateRiskReturn-ReleveRisquesClimatiques@osfi-bsif.gc.ca.

Key Terms and Definitions

Key TermDefinition
Absolute Emissions

Volume of greenhouse gas (GHG) emissions expressed in tonnes of carbon dioxide-equivalent (CO2-e). For the purposes of this return, "absolute emissions" refers to generated emissions and not values relating to avoided emissions or emission removals.

Asset Class

A group of financial instruments that have similar financial characteristics.

Carbon Dioxide-equivalent (CO2-e)

The universal unit of measurement to show the global warming potential (GWP) of each of the seven greenhouse gases, expressed in terms of the GWP of one unit of carbon dioxide for 100 years. This unit is used to evaluate releasing different greenhouse gases against a common basis.

Claims Paid

The dollar amount (in thousands) of insured claims paid during the reporting period.

For the IC1 return, Claims Paid include loss (i.e., indemnity) and allocated loss adjustment expenses paid during the reporting period. Claims paid should be net of insureds’ deductibles and gross of Reinsurance Recoveries. Claims Paid include only amounts that were paid as a result of physical damage caused by climate change-related PerilsFootnote 1. Payments due to non-natural causes, such as burst pipes or arson, as well as payments for liability-related and warranty-related claims are excluded.

See the definition of Peril below for further details on climate change-related perils.

Financed Emissions

Absolute greenhouse gas (GHG) emissions that FRFIs and investors finance through their loans and investments. See Absolute Emissions.

FRFI

Federally Regulated Financial Institution (i.e., a deposit-taking institution (DTI) or insurer regulated by OSFI).

Greenhouse gas (GHG) emissions

Emissions of the seven greenhouse gases listed in the Kyoto Protocol–carbon dioxide (CO2); methane (CH4); nitrous oxide (N2O); hydrofluorocarbons (HFCs); nitrogen trifluoride (NF3); perfluorocarbons (PFCs); and sulphur hexafluoride (SF6).

Insurance Revenue

Revenue from insurance contracts for the reporting period calculated in accordance with IFRS 17 Insurance Contracts

Insurance Classes

For the the IC1 and IC2 Returns, Insurance Classes are grouped as follows:

  1. Personal Automobile
  2. Commercial Property
  3. Other Commercial Lines
  4. Personal Property
  5. Other Personal

Commercial insurance classes refer to insurance offered to commercial clients (e.g., businesses and associations). Personal insurance classes refer to insurance offered to individuals.

With respect to Commercial Automobile insurance,

  • For IC1 purposes, any commercial automobile policies should be reported under the Other commercial insurance class.
  • For IC2 purposes, commercial automobile policies should not be reported within the insurance classes as assocated GHG emissions are already subsumed in other insurance classes.
Insurance-associated emissions

Greenhouse gas (GHG) emissions in the real economy, which are associated with specific re/insurance policies aggregated in the re/insurance portfolios of a FRFI. See definition of “FRFI”, above.

Peril

For purposes of the IC1 Return, perils are climate change-driven, weather-related events that result in physical damage losses. The four types of perils used for the IC1 Return are: 1) wildfire, 2) water, 3) convective wind, and 4) other climate change-driven perils.

  1. Wildfire: A wide-area destructive fire that spreads quickly over (typically) woodland or brush.
  2. Water: Water damage caused by hurricanes and/or floods.
    Floods can include:
    • coastal or surge floods,
    • riverine or fluvial floods, and
    • flash, surface, or pluvial floods.
  3. Convective Wind: Severe wind caused by convective weather activity including tornadoes.
  4. Other climate change-driven: All other climate change-driven, weather-related events that result in physical damage losses that are not included in perils 1) – 3), above.
Physical risks

Risks resulting from climate change that can be event-driven (acute) or from longer-term shifts (chronic) in climate patterns. These risks may carry financial implications for entities, such as direct damage to assets and indirect effects of supply-chain disruption. FRFIs’ financial performance may also be affected by changes in water availability, sourcing, and quality; and extreme temperature changes affecting entities’ premises, operations, supply chain, transportation needs, and employee safety.

Probable maximum loss (PML)

The value of the maximum loss that could result from a peril, expressed in thousands of dollars.

Reinsurance Recoveries

Dollar amounts (expressed in thousands) collected from the reinsurer by a ceding insurer during the reporting period related to Claims Paid. See above for the definition of Claims Paid.

Scope 1 Greenhouse Gas (GHG) Emissions

Direct GHG emissions that occur from sources owned or controlled by the FRFI — i.e., GHG emissions from combustion in owned or controlled boilers, furnaces, vehicles, etc.

Scope 2 Greenhouse Gas (GHG) Emissions

Indirect greenhouse gas (GHG) emissions from the generation of purchased or acquired electricity, steam, heating, or cooling consumed by the FRFI.

Scope 3 Greenhouse Gas (GHG) Emissions

All other indirect GHG emissions (not included in Scope 2) that occur in the value chain of the reporting company.

For the purposes of this return, Scope 3 emissions include the following categories (consistent with the GHG Protocol):

Upstream:

  1. purchased goods and services;
  2. capital goods;
  3. fuel- and energy-related activities not included in Scope 1 emissions or Scope 2 emissions;
  4. upstream transportation and distribution;
  5. waste generated in operations;
  6. business travel;
  7. employee commuting;

Downstream:

  1. upstream leased assets;
  2. downstream transportation and distribution;
  3. processing of sold products;
  4. use of sold products;
  5. end-of-life treatment of sold products;
  6. downstream leased assets;
  7. franchises;
  8. investments (a.k.a “financed emissions”)
    1. (scope 1 and 2) emissions of a FRFI’s investees
    2. (scope 1 and 2) emissions of a FRFI’s borrowers
  9. insurance-associated emissions

See definitions of "Financed Emissions" and "Insurance-Associated Emissions", above.

Insurance-Associated Emissions (see definition above) are not to be aggregated with Financed Emissions, but are to be calculated and reported distinctly from Financed emissions.

Transition risks

Moving to a lower-carbon economy may entail extensive policy, legal, technology and market changes to address mitigation and adaptation requirements relating to climate change. Depending on the nature, speed and focus of these changes, transition risks may pose varying levels of financial and reputational risk to FRFIs.

Value Chain

The full range of activities, resources and relationships related to a FRFI’s business model and the external environment in which it operates.

Units of Measurement for Reporting

Financial Figures

Reported financial figures, such as claims paid, reinsurance recoveries, outstanding loan balances or investment security values, should be expressed in thousands of Canadian Dollars or Canadian Dollar Equivalent, with no commas or other separators, unless otherwise specified. Note, policy count is not expressed in thousands.

Greenhouse gas (GHG) Emissions

All reporting on Absolute GHG Emissions, including Scope 1, Scope 2 and Scope 3 emissions should be reported in metric tons of carbon dioxide-equivalent (tCO2-e), to 2 decimal places.

Probabilities and Percentages

All probabilities and percentages should be reported as their decimal equivalents. For example, a figure of 1.09% should be reported as 0.0109.

Greenhouse gas emissions accounting

Regarding calculation of GHG emissions, the FRFI is expected to use the latest GHG Protocol Corporate Accounting and Reporting Standard and the latest GHG Protocol Corporate Value Chain (Scope 3) Accounting and Reporting Standard.

Regarding calculation of the portion(s) of Scope 3 GHG emissions, pertaining to the FRFI’s financed, and/or insurance-associated GHG emissions, the FRFI is expected to use the latest Partnership for Carbon Accounting Financials’ (PCAF’s) Global GHG Accounting and Reporting Standard for the Financial Industry (PCAF Standard).

Structure of the Climate-Related Risk Returns for Insurers

Tabular Structure of the Climate-Related Data Return Templates

Each data return is structured to contain three types of data fields:

  • Sub-Table Field
  • Categorical Data Fields
  • Calculated Data Fields

An illustration, using an example from the structure of the IC1 return, is shown below.

The three types of data fields in the IC1 Return. A text description follows.
  1. Sub-Table Field: This data field is used to report the Sub-Table of the return (return_subtable). See the section Return Sub-Tables below for further details.
  2. Categorical Data Fields: These data fields are used to report qualitative data that are mutually exclusive. Categorical fields used in the Climate-Related Risk Returns for Insurers are as follows: asset_class, insurance_class, region, industry, credit_quality and fsa (N.B. asset_class, industry, and credit_quality are not fields included in the IC1 return, consistent with the illustration above).
  3. Calculated Data Fields: The data reported in these fields are to be calculated to reflect the maximum granularity established by the applicable Categorical Data Fields, unless otherwise noted. Referencing the illustration above, the policy count reported as 446188 in the first row in the field policy_count represents (is calculated as) the number of policies in the Forward Sortation Area (fsa) T1A that are of the insurance_class code ‘1’ (‘Personal Automobile’).

Reference Format

Submission keys that identify each data field being collected are included in the first row of each template. For ease of identification within this document, submission keys are formatted in lower case with underscored spacing, such as return_subtable.

For categorical fields, categorical codes and their related values are listed in single quotes, such as code ‘1’ and ‘Personal Automobile’ respectively.

Categorical Field Selections

Tables containing the comprehensive list of the selections available for each of the categorical fields, other than fsa, are provided in the appendices to this document as follows:

These tables correspond to those included in the input templates for the IC1 and IC2 returns.

Return Sub-Tables

For reporting purposes, each return consists of a single data table that are divided into sub-tables that group related reporting data elements. The sub-tables for each of the returns are as follows:

Insurance Physical Risk Return (IC1)
Return Sub-Table NameReturn Sub-Table Code
Insurance Claim and Revenue Metrics – In Canada by FSAIC1-A
Insurance Claim and Revenue Metrics – Outside of Canada by RegionIC1-B
Probable Maximum Loss (PML) by RegionIC1-C
Insurance Transition Risk Return (IC2)
Return Sub-Table NameReturn Sub-Table Code
Entity-level GHG Emissions by ScopeIC2-A
Financed GHG Emissions by Asset ClassIC2-B
Insurance-Associated GHG EmissionsIC2-C

Field Applicability by Sub-Table

The fields applicable for each Sub-Table are outlined in the Field Applicability Matrices document (XLSX, 29.9 KB). Reported fields are based upon the insurance_class for the IC1 Return, by asset_class for Sub-Table IC1-A and IC1-B of the IC2 Return, and by insurance_class for Sub-Table IC2-C. Non-applicable fields should be reported as blank on each row.

Instructions for the Physical Risk Return (IC1)

This return collects data on insurance revenues and paid claims losses to assess Insurers’ historical loss experience due to Physical Risk from climate-driven perils for select climate-exposed insurance classes. This return also collects Probable Maximum Loss (PML) data at a regional granularity to assess Insurers’ forward-looking loss exposures due to physical risk from climate-driven perils.

Overview of Return Data Fields

The following fields are included in the IC1 Return template:

Sub-Table Field

return_subtable

Categorical Data Fields

  • insurance_class
  • region
  • fsa

Calculated Fields

  • insurance_revenue
  • policy_count
  • claims_paid_water
  • claims_paid_wildfire
  • claims_paid_wind
  • claims_paid_otherclimate
  • count_claims_paid_water
  • count_claims_paid_wildfire
  • count_claims_paid_wind
  • count_claims_paid_otherclimate
  • reinsur_recov_water
  • reinsur_recov_wildfire
  • reinsur_recov_wind
  • reinsur_recov_otherclimate
  • total_insured_value
  • pml_water_1_100
  • pml_wildfires_1_100
  • pml_wind_1_100
  • pml_other_1_100
  • pml_water_1_250
  • pml_wildfires_1_250
  • pml_wind_1_250
  • pml_other_1_250

The above fields are to be completed using the reporting template provided at IC1 Technical Specifications (XLSX, 51.4 KB), following the instructions below for reporting claims losses and premiums applicable in Canada and outside of Canada, as well as PML data.

Field Applicability by Sub-Table

The fields applicable for each Sub-Table are outlined in the Field Applicability Matrices (See Link: Field Applicability Matrices document (XLSX, 29.9 KB)).

Sub-Table IC1-A: Insurance Claims and Revenue Metrics – In Canada by FSA

Report on all fields in the template for written in Canada, per the instructions below. References below to claims paid, counts of claims paid and reinsurance recoveries should include only amounts that were paid/received as a result of physical damage caused by climate change-related Perils, and exclude claims paid due to non-natural causes such as burst pipes or arson, as well as liability-related and warranty-related claims.

Sub-Table Field

  • return_subtable – Set field value to ‘IC1-A’ on each row reported

Categorical Data Fields

  • insurance_class – Report the applicable class of insurance per table in Appendix II – Class of Insurance for each row reported. For multi-peril policies, include insurance written for commercial clients under “Other Commercial Lines”, otherwise use Other Personal.
  • region – Report as blank on each row reported.
  • fsa – Report the 3-digit Forward Sortation Area location reference of the insured for each row; applicable to insureds at Canadian addresses only

Calculated Data Fields

  • insurance_revenue – Report the dollar amount of insurance revenue for the insurance_class in the reported fsa for the fiscal year
  • policy_count – Report the number of active policies written for the insurance_class in the reported fsa.
  • claims_paid_water – Report the dollar amount of water-related claims paid under coverage offered in the insurance_class in the reported fsa, net of deductible and gross of reinsurance recoveries for the fiscal year
  • claims_paid_wildfire – Report the dollar amount of wildfire-related claims paid under coverage offered in the insurance_class in the reported fsa, net of deductible and gross of reinsurance recoveries for the fiscal year
  • claims_paid_wind – Report the dollar amount of convective wind-related claims paid (excluding flooding related losses) under coverage offered in the insurance_class in the reported fsa, net of deductible and gross of reinsurance recoveries for the fiscal year
  • claims_paid_otherclimate – Report the dollar amount of other climate-related claims paid under coverage offered in the insurance_class in the reported fsa, net of deductible and gross of reinsurance recoveries for the fiscal year
  • count_claims_paid_water – Report the number of water-related claims paid under coverage offered in the insurance_class in the reported fsa for the fiscal year
  • count_claims_paid_wildfire - Report the number of wildfire-related claims paid under coverage offered in the insurance_class in the reported fsa for the fiscal year
  • count_claims_paid_wind – Report the number of convective wind-related claims paid (excluding flooding related losses) under coverage offered in the insurance_class in the reported fsa for the fiscal year
  • count_claims_paid_otherclimate – Report the number of other climate-related claims paid under coverage offered in the insurance_class in the reported fsa for the fiscal year
  • reinsur_recov_water – Report the dollar amount of reinsurance recoveries pertaining to water-related claims for the insurance_class in the reported fsa, for the fiscal year
  • reinsur_recov_wildfire – Report the dollar amount of reinsurance recoveries pertaining to wildfire-related claims for the insurance_class in the reported fsa, for the fiscal year
  • reinsur_recov_wind – Report the dollar amount of reinsurance recoveries pertaining to convective wind-related claims for the insurance_class in the reported fsa, for the fiscal year
  • reinsur_recov_otherclimate – Report the dollar amount of reinsurance recoveries pertaining to other climate-related claims for the insurance_class in the reported fsa, for the fiscal year
  • total_insured_value – Report the sum of the dollar amounts of total insured values on assets under coverage to insureds in the insurance_class in the reported fsa, net of deductible
  • Report the following fields as blank on each row:
    • pml_water_1_100
    • pml_wildfires_1_100
    • pml_wind_1_100
    • pml_other_1_100
    • pml_water_1_250
    • pml_wildfires_1_250
    • pml_wind_1_250
    • pml_other_1_250

Sub-Table IC1-B: Insurance Claims and Revenue Metrics – Outside Canada

Report on all fields in the template for written outside Canada, per the instructions by submission key below. References below to claims paid, counts of claims paid and reinsurance recoveries should include only amounts that were paid/received as a result of physical damage caused by climate change-related Perils, and exclude claims paid due to non-natural causes such as burst pipes or arson, as well as liability-related and warranty-related claims.

Sub-Table Field

  • return_subtable – Set field value to ‘IC1-B’ on each row reported

Categorical Data Fields

  • insurance_class – Report the applicable class of insurance per table in Appendix II – Class of Insurance for each row reported. For multi-peril policies, include insurance written for commercial clients under “Other Commercial Lines”, otherwise use “Other Personal.”
  • region – Report the applicable region of the USA and ‘Other’ geographic region per the table in Appendix III – Regions on each row reported
  • fsa – Report as blank on each row reported

Calculated Data Fields

  • insurance_revenue – report the dollar amount of insurance revenue for the insurance_class in the reported region for the fiscal year
  • policy_count – report the number of active policies written for the insurance_class in the reported region.
  • claims_paid_wind – Report the dollar amount of convective wind-related claims paid (excluding flooding related losses) under coverage offered in the insurance_class in the reported region, net of deductible and gross of reinsurance recoveries for the fiscal year
  • claims_paid_otherclimate – Report the dollar amount of other climate-related claims paid under coverage offered in the insurance_class in the reported region, net of deductible and gross of reinsurance recoveries for the fiscal year
  • count_claims_paid_water – Report the number of water-related claims paid under coverage offered in the insurance_class in the reported region for the fiscal year
  • count_claims_paid_wildfire - Report the number of wildfire-related claims paid under coverage offered in the insurance_class in the reported region for the fiscal year
  • count_claims_paid_water – Report the number of water-related claims paid under coverage offered in the insurance_class in the reported region for the fiscal year
  • count_claims_paid_wildfire - Report the number of wildfire-related claims paid under coverage offered in the insurance_class in the reported region for the fiscal year
  • count_claims_paid_wind – Report the number of convective wind-related claims paid (excluding flooding related losses) under coverage offered in the insurance_class in the reported region for the fiscal year
  • count_claims_paid_otherclimate – Report the number of other climate-related claims paid under coverage offered in the insurance_class in the reported region for the fiscal year
  • reinsur_recov_water – Report the dollar amount of reinsurance recoveries pertaining to water-related claims for the insurance_class in the reported region, for the fiscal year
  • reinsur_recov_wildfire - Report the dollar amount of reinsurance recoveries pertaining to wildfire-related claims for the insurance_class in the reported region, for the fiscal year
  • reinsur_recov_wind – Report the dollar amount of reinsurance recoveries pertaining to convective wind-related claims for the insurance_class in the reported region, for the fiscal year
  • reinsur_recov_otherclimate – Report the dollar amount of reinsurance recoveries pertaining to other climate-related claims for the insurance_class in the reported region, for the fiscal year
  • total_insured_value – Report the sum of the dollar amounts of total insured values on assets under coverage to insureds in the insurance_class in the reported region, net of deductible
  • Report the following fields as blank on each row:
    • pml_water_1_100
    • pml_wildfires_1_100
    • pml_wind_1_100
    • pml_other_1_100
    • pml_water_1_250
    • pml_wildfires_1_250
    • pml_wind_1_250
    • pml_other_1_250

Sub-Table IC1-C: Probable Maximum Loss (PML) By Region

Report on all data fields in the template per the instructions by submission key below for each row reported.

Sub-Table Field

  • return_subtable – Set field value to ‘IC1-C’

Categorical Data Fields

  • insurance_class – Report the defined loan classification per table in Appendix I – Asset Categories
  • region – Report the applicable region of the USA and ‘Other’ geographic region per the table in Appendix III – Regions
  • fsa – Report as blank

Calculated Data Fields

  • Report the following fields as blank on each row:
    • insurance_revenue
    • policy_count
    • claims_paid_water
    • claims_paid_wildfire
    • claims_paid_wind
    • claims_paid_otherclimate
    • count_claims_paid_water
    • count_claims_paid_wildfire
    • count_claims_paid_wind
    • count_claims_paid_otherclimate
    • reinsur_recov_water
    • reinsur_recov_wildfire
    • reinsur_recov_wind
    • reinsur_recov_otherclimate
  • pml_water_1_100 – Report the Probable Maximum Loss (PML) for a 100-year return period on water (i.e., PML100) for each region by insurance_class. Optionally, if available, reporting on PML pertaining to region code ‘C1’ (‘Canada-Other’) should reflect Canada-Wide PML100 and region code ‘U6’ (‘USA-Other’) should address US-wide PML100 for Flood.
  • pml_wildfires_1_100 – Report the Probable Maximum Loss (PML) for a 100-year return period on Wildfire (i.e., PML100) for each region by insurance_class. Optionally, if available, reporting on PML pertaining to region code ‘C1’ (‘Canada-Other’) should reflect Canada-Wide PML100 and region code ‘U6’ (‘USA-Other’) should address US-wide PML100 for Wildfire.
  • pml_wind_1_100 – Report the Probable Maximum Loss (PML) for a 100-year return period from wind (i.e., PML100) for each region by insurance_class. Optionally, if available, reporting on PML pertaining to region code ‘C1’ (‘Canada-Other’) should reflect Canada-Wide PML100 and region code ‘U6’ (‘USA-Other’) should address US-wide PML100 for Storms.
  • pml_other_1_100 – Report the Probable Maximum Loss (PML) for a 100-year return period on Other Climate-Related Perils (i.e., PML100) for each region by insurance_class. Optionally, if available, reporting on PML pertaining to region code ‘C1’ (‘Canada-Other’) should reflect Canada-Wide PML100 and region code ‘U6’ (‘USA-Other’) should address US-wide PML100 for Other Climate-Related Perils.
  • pml_water_1_250 – Report the Probable Maximum Loss (PML) for a 250-year return period on Flood (i.e., PML250) for each region by insurance_class. Optionally, if available, reporting on PML pertaining to region code ‘C1’ (‘Canada-Other’) should reflect Canada-Wide PML250 and region code ‘U6’ (‘USA-Other’) should address US-wide PML250 for Flood.
  • pml_wildfires_1_250 – Report the Probable Maximum Loss (PML) for a 250-year return period on Wildfire (i.e., PML250) for each region by insurance_class. Optionally, if available, reporting on PML pertaining to region code ‘C1’ (‘Canada-Other’) should reflect Canada-Wide PML250 and region code ‘U6’ (‘USA-Other’) should address US-wide PML250 for Wildfire.
  • pml_wind_1_250 – Report the Probable Maximum Loss (PML) for a 250-year return period from Storms (i.e., PML250) for each region by insurance_class. Optionally, if available, reporting on PML pertaining to region code ‘C1’ (‘Canada-Other’) should reflect Canada-Wide PML250 and region code ‘U6’ (‘USA-Other’) should address US-wide PML250 for Storms.
  • pml_other_1_250 – Report the Probable Maximum Loss (PML) for a 250-year return period on Other Climate-Related Perils (i.e., PML250) for each region by insurance_class. Optionally, if available, reporting on PML pertaining to region code ‘C1’ (‘Canada-Other’) should reflect Canada-Wide PML250 and region code ‘U6’ (‘USA-Other’) should address US-wide PML250 for Other Climate-Related Perils.

Additional Reporting Guidance

The technical specifications document for the IC1 return, that includes a template sheet, field definitions and reference tables is available at IC1 Technical Specifications (XLSX, 51.4 KB). For a reference example of a completed template that contains an abbreviated listing of completed rows following the above IC1 template instructions, see the sample IC1 Return template (IC1 Example Return Filing (CSV, 9.6 KB)).

Instructions for the Transition Risk Return (IC2)

This return collects GHG Absolute Emissions assigned on Investments and other Balance Sheet Assets and entity-wide (unassigned) from FRFIs. It also collects Insurance-Associated GHG Emissions to assess the emissions footprint enabled by FRFIs' underwritten insurance businesses.

Overview of Return Data Fields

The following fields are included in the IC2 Return templates:

Sub-Table Field

return_subtable

Categorical Data Fields

  • asset_class
  • insurance_class
  • industry
  • region
  • credit_quality

Calculated Fields

  • scope_1_absolute_emissions
  • scope_2_absolute_emissions
  • scope_3_absolute_emissions
  • data_quality_score
  • asset_balance
  • weighted_average _maturity
  • balance_5_maturity
  • balance_10_ maturity

The above template fields are to be reported by completing the template contained in the technical specifications provided at IC2 Technical Specifications (XLSX, 52.8 KB), following the instructions below for reporting Absolute GHG emissions and other related metrics on transition risk in Canada and outside of Canada.

Field Applicability by Sub-Table

The fields applicable for each Sub-Table are outlined in the Field Applicability Matrices (See Link: Field Applicability Matrices document (XLSX, 29.9 KB)).

Sub-Table IC2-A: Entity-level GHG Emissions by Scope

Report emissions by scope, excluding Financed Emissions for Scope 3, using the instructions by submission key below.

Sub-Table Field

  • return_subtable – Set field value to ‘IC2-A’ on each row reported

Categorical Data Fields

  • asset_class – Set field value to code ‘14’(‘Unassigned’) for each row reported; reporting on other asset categories is not applicable for Sub-Table IC2-A (see Field Applicability by Sub-Table section above for details)
  • insurance_class – Report as blank
  • industry – Not applicable; Report as blank
  • region – Report the applicable province or territory of Canada, Region of USA or ‘Other’ geographic region per the table in Appendix III – Region
  • credit_quality – Not applicable; Report as blank

Calculated Data Fields

  • scope_1_absolute_emissions – Report Absolute Scope 1 GHG Emissions (in tCO2-Equivalent) produced within each reported region
  • scope_2_absolute_emissions – Report Absolute Scope 2 GHG Emissions (in tCO2-Equivalent) within each reported region
  • scope_3_absolute_emissions – Absolute Scope 3 GHG Emissions (in tCO2-Equivalent) within each reported region
  • data_quality_score – Report the Partnership for Carbon Accounting Financials (“PCAF”) Data quality score (1 to 5) on scoped emissions generated within each reported region
  • asset_balance – Report as blank
  • weighted_average_maturity – Report as blank
  • balance_5_maturity – Report as blank
  • balance_10_maturity – Report as blank

Sub-Table IC2-B: Financed GHG Emissions – Scope 3 by Asset Class

For purposes of reporting Scope 3 (Financed) Emissions, report on each row using the instructions by submission key below.

Sub-Table Field

  • return_subtable – Set field value to ‘IC2-B’

Categorical Data Fields

  • asset_class – Report on each of the defined asset categories (see the table in Appendix I - Asset Categories for reference). Do not report using the ‘Unassigned’ classification of the asset_class for reporting on Financed GHG Emissions. For each selection within the asset_class, certain categorical fields may be applicable (see Field Applicability by Sub-Table section above for reference).
  • insurance_class – Report as blank
  • industry – If applicable per the Field Applicability Matrices, report the applicable industry code for each classification per the table in Appendix I - Asset Categories; otherwise report the industry field as blank
  • region – If applicable for the applicable asset_class per the Field Applicability Matrices, report the applicable province or territory of Canada, Region of USA or ‘Other’ geographic region per the table in Appendix III – Region; otherwise report the region field as blank
  • credit_quality – If applicable for the asset_class per the Field Applicability Matrices, report the applicable credit_quality code per the table in Appendix V – Credit Quality Ratings; otherwise, report the credit_quality field for the non-applicable rows as blank

Calculated Fields

  • scope_1_absolute_emissions – Report as blank
  • scope_2_absolute_emissions – Report as blank
  • scope_3_absolute_emissions – Report the applicable amount of Absolute Scope 3 GHG Financed emissions for each asset_class by each region category (if applicable) by each industry category (if applicable) by each credit_quality category (if applicable).
  • data_quality_score – Report the PCAF Data quality score (1 to 5) on scoped emissions generated for each asset_class by each region category (if applicable) by each industry category (if applicable) by each credit_quality category (if applicable).
  • asset_balance – Report the applicable financial balance for each asset_class by each region category (if applicable) split by each industry category (if applicable) by each credit_quality category (if applicable).
  • weighted_average_maturity – Report the applicable exposure weighted maturity, measured in years, for each asset_class split by each region category by each industry category (if applicable) by each credit_quality category (if applicable).
  • balance_5_maturity – Report the dollar amount of the asset_balance with a remaining maturity of between 5 and 10 years.
  • balance_10_maturity – Report the dollar amount of the asset_balance with a remaining maturity greater than 10 years.

Sub-Table IC2-C: Insurance-Associated GHG Emissions

For purposes of reporting Scope 3 (Insurance-Associated) Emissions by insurance class, report on each row using the instructions by submission key below. Note that this Sub-Table is to be completed by insurers writing classes of insurance including personal automobile, commercial property and other commercial lines.

Sub-Table Field

  • return_subtable – Set field value to ‘IC2-C’ on each row reported

Categorical Data Fields

  • asset_class – Report as blank
  • insurance_class – Report the applicable class of insurance code per Appendix II – Classes of Insurance; for purposes of reporting on IC2-C, only include the following Classes of Insurance: Personal Automobile, Commercial Property, Other Commercial Lines (do not report on ‘Personal Property’).
  • industry – Report the applicable industry code for each insurance_class per the table in Appendix III – Industry; for insurance_class code ‘1’ (‘Personal Automobile’) and insurance_class code ‘’5’ (‘Other Insurance Lines’) report the industry field as blank
  • region – Report the applicable region for each insurance_class per the table in Appendix IV - Region
  • credit_quality – Report as blank

Calculated Fields

  • scope_1_absolute_emissions – Report as blank
  • scope_2_absolute_emissions – Report as blank
  • scope_3_absolute_emissions – Report the applicable amount of Absolute Scope 3 GHG Insurance-Associated emissions for each applicable insurance_class (‘Personal Automobile’, ‘Commercial Property’, ‘Other Commercial Lines’) for each region by each industry.
  • data_quality_score – Report the PCAF Data quality score (1 to 5) on scoped emissions generated for each insurance_class by each region category by each industry category.
  • Report the following fields as blank on each row:
    • asset_balance
    • weighted_average_maturity
    • balance_5_maturity
    • balance_10_maturity

Additional Reporting Guidance

The technical specifications document for the IC2 return, that includes a template sheet, field definitions and reference tables is available at IC2 Technical Specifications (XLSX, 52.8 KB). For a reference example of a completed template that contains an abbreviated listing of completed rows following the above IC2 template instructions, see the sample IC2 Return template (IC2 Example Return Filing (CSV, 5.4 KB)).

Appendix I – Asset Categories

The following categories are to be used for the asset_class field when completing the IC2 Return. The coding selections below reflect the investment security classifications on the Supervisory Quarterly Returns as follows:

  • Life Insurance (LF2): Exhibit 21.012
  • Mortgage Insurance (MI4): Exhibit 40.08
  • Property & Casualty Insurance (PC2): Exhibit 40.08

The Unassigned asset class is to be used for reporting on entity-wide emissions in IC2 return sub-table 'IC2-A' only, and it is not intended to be used in lieu of reporting emissions by specific asset classes in IC2 return sub-table 'IC2-B'.

Report in the asset_class field using the codes shown below.

asset_class Asset Class Name
1Short Term Investments
2Bonds and Debentures – Government – Federal
3Bonds and Debentures – Government – Provincial
4Bonds and Debentures – Municipal, Public Authority, Schools
5Bonds and Debentures – Corporate – Public
6Bonds and Debentures – Corporate – Private
7Mortgage Loans
8Preferred Shares – Fixed Term
9Preferred Shares – Equity Preferred
10Total Common Shares
11Investment in Subsidiaries
12Other Loans
13Other Invested Assets
14Unassigned

Appendix II – Insurance Classes

The classes of insurance presented in the table below are to be used for purposes of reporting in the insurance_class categorical field. Report in the insurance_class field using the codes shown below.

insurance_class Insurance Class Names
1Personal Automobile
2Commercial Property
3Other Commercial Lines
4Personal Property
5Other Personal

Appendix III – Regions

The categorical codes shown in the table below are to be used for the region field when completing the IC1 Return and the IC2 Return. The name for each region, along with a Region Description that lists the constituent region(s) associated to each Region code are also listed in the table below. For example, the Region code ‘US2’, described as ‘USA Midwest’ is constituted of a grouping of states of the USA including: ‘IA’, ‘IL’, ‘IN’, ‘KS’, ‘MI’, ‘MN’, ‘MO’, ‘ND’, ‘NE’, ‘OH’, ‘SD’, and ‘WI’.

Report in the region field using the codes shown below.

region Region Name Region Description
ABAlberta, CanadaAlberta, Canada
BCBritish Columbia, CanadaBritish Columbia, Canada
MBManitoba, CanadaManitoba, Canada
NBNew Brunswick, CanadaNew Brunswick, Canada
NLNewfoundland and Labrador, CanadaNewfoundland and Labrador, Canada
NTNorthwest Territories, CanadaNorthwest Territories, Canada
NSNova Scotia, CanadaNova Scotia, Canada
NUNunavut, CanadaNunavut, Canada
ONOntario, CanadaOntario, Canada
PEPrince Edward Island, CanadaPrince Edward Island, Canada
QCQuebec, CanadaQuebec, Canada
SKSaskatchewan, CanadaSaskatchewan, Canada
YKYukon, CanadaYukon, Canada
C1Canada-Other Includes all other regions of Canada not classified above
U1USA West Region of USA that includes the following US States: AK, CA, CO, HI, ID, MT, NV, OR, UT, WA, WY
U2USA Midwest Region of USA that includes the following US States: IA, IL, IN, KS, MI, MN, MO, ND, NE, OH, SD, WI
U3USA Northeast Region of USA that includes the following US States: CT, MA, ME, NH, NJ, NY, PA, RI, VT
U4USA Southwest Region of USA that includes the following US States: AZ, NM, OK, TX
U5USA Southeast Region of USA that includes the following US States: AL, AR, DE, FL, GA, KY, LA, MD, MS, NC, SC, TN, VA, WV as well as DC
U6USA-Other Includes all other regions of USA not classified above
ZZOther All other regions worldwide

Appendix IV – Industries

The coding selections shown in the table below are to be used for the industry field when completing the IC2 Return. The descriptions for each industry code, including an industry name and the applicable NAICS descriptions and NAICS code(s) that consitute the defined Industry code are also provided in the table below. For the Industry codes ‘1’ (‘Air Transportation’) to ‘23’ (‘Water Transportation’), which are considered high-GHG emitting industry sectors, one or more than one NAICS code may apply.

The remaining codes, between ‘24’ and ‘42’ inclusive, that have the prefix ‘Other Non-HES-’ are not considered to be high-emitting industry sectors. In order to ensure mutual exclusivity, when reporting using the categories for the codes with the prefix ‘Other Non-HES-’ , amounts reported for the related high-emitting industry sectors (as listed for Industry codes ‘1’ to ‘23’) should be excluded to avoid double-counting.

Report in the industry field using the codes shown below.

industryIndustry NameIndustry Description (NAICS Code)
1Air TransportationAir transportation (481)
2Chemical ManufacturingChemical manufacturing (325), Plastics and rubber products manufacturing (326)
3CoalCoal mining (2121), Contract drilling (except oil and gas) (213117), Other support activities for mining (213119)
4CropCrop production (111)
5Crude PetroleumCrude petroleum from oil shale (211120)
6Electric PowerElectric power transmission, control and distribution (22112)
7ForestryForestry and logging (113)
8Fossil Fuel ElectricFossil-fuel electric power generation (221112)
9Hydro NuclearHydro and nuclear (221111), Nuclear electric power generation (221113)
10LivestockAnimal production and aquaculture (112)
11Natural GasNatural gas distribution (2212)
12Nonmetallic ManufacturingNonmetallic mineral product manufacturing (327)
13Oil GasOil and gas extraction (except oil sands) (211110)
14Oil SandsOil sands extraction (21114)
15Other TransportationTruck transportation (484), Transit and Ground Passenger transportation (485), Scenic and other sightseeing transportation (487), Support activities for transportation (488), Postal service (491), Couriers and messengers (492), Warehousing and storage (493)
16Paper ManufacturingConverted paper product manufacturing (322), Printing and related support activities (323)
17Petroleum ManufacturingPetroleum and coal products manufacturing (324)
18Pipeline TransportPipeline transportation (486)
19Primary ManufacturingPrimary metal manufacturing (331), Fabricated metal product manufacturing (332)
20Rail TransportationRail transportation (482)
21RenewablesOther renewables (221119)
22Oil Gas ServicesOil and gas contract drilling (213111), Services to oil and gas extraction (213118)
23Water TransportWater transportation (483)
24Other Non-HES-AgricultureAgriculture, forestry, fishing and hunting (11)
25Other Non-HES-MiningMining, quarrying, and oil and gas extraction (21)
26Other Non-HES-UtilitiesUtilities (22)
27Other Non-HES-ConstructionConstruction (23)
28Other Non-HES-ManufacturingManufacturing (31-33)
29Other Non-HES-WholesaleWholesale trade (41)
30Other Non-HES-RetailRetail trade (44-45)
31Other Non-HES-InformationInformation and cultural industries (51)
32Other Non-HES-Finance InsFinance and insurance (52)
33Other Non-HES-Real EstateReal estate and rental and leasing (53)
34Other Non-HES-ProfessionalProfessional, scientific and technical services (54)
35Other Non-HES-ManagementManagement of companies and enterprises (55)
36Other Non-HES-AdministrativeAdministrative and support, waste management and remediation services (56)
37Other Non-HES-EducationalEducational services (61)
38Other Non-HES-Health CareHealth care and social assistance (62)
39Other Non-HES-Arts EntArts, entertainment and recreation (71)
40Other Non-HES-AccommodationAccommodation and food services (72)
41Other Non-HES-Other Non-PAOther services (except public administration) (81)
42Other Non-HES-Public AdminPublic administration (91)

Appendix V – Credit Quality Ratings

Externally-assigned ratings of long-term borrower creditworthiness are assigned on debt security issuers and wholesale borrowers including corporates, banks and sovereigns. To facilitate comparison, ratings from several recognized credit rating organizations should be mapped into the credit_quality categories shown in the table below. For reporting purposes on the IC2 return, investments should be grouped within each credit_quality category; borrowers are not to be reported on an individual name basis.

Report in the credit_quality field using the codes shown below.

credit_qualityS&PDBRSMoody’sFitchKBRA
1AAA to AA-AAA to AA (low)Aaa to Aa3AAA to AA-AAA to AA-
2A+ to A-A (high) to A (low)A1 to A3A+ to A-A+ to A-
3BBB+ to BBB-BBB (high) to BBB (low)Baa1 to Baa3BBB+ to BBB-BBB+ to BBB-
4BB+ to BB-BB (high) to BB (low)Ba1 to Ba3BB+ to BB-BB+ to BB-
5B+ to B-B (high) to B (low)B1 to B3B+ to B-B+ to B-
6Below B-CCC or lowerBelow B3Below B-Below B-
7Not RatedNot RatedNot RatedNot RatedNot Rated

Footnotes

Footnote 1

Claims paid on peril events pertaining to wildfire, water, convective wind and other climate-change related weather events are coded as relating to natural catstrophe events within many insurers’ claim management systems, potentially facilitating FRFIs’ gathering and summarization of such data.

Return to footnote 1

​