French insurer AXA plans to stop investing in the tobacco industry, citing the impact of smoking on public health.

The company also said it plans to sell its €1.8 billion of assets in the sector. 

AXA said it would divest its €200m of equity holdings in tobacco companies immediately. 

It also plans to stop all new investments in tobacco industry corporate bonds and run off its existing holdings worth about €1.6 billion.

"With this divestment from tobacco, we are doing our share to support the efforts of governments around the world," incoming AXA chief executive Thomas Buberl said in a statement. 

"This decision has a cost for us, but the case for divestment is clear: the human cost of tobacco is tragic; its economic cost is huge," he added. 
             
AXA said that tobacco kills six million people a year and that the figure is expected to rise to eight million by 2030, mostly in developing countries. The cost to society is greater than that of alcohol or obesity, the company added.

The decision reflects a shift in the role of health insurers towards preventing health conditions, AXA said, including increased use of technology. 

The head of the Union for International Cancer Control (UICC) said in the same statement that it would continue to encourage other companies to follow AXA's lead. 

"We need companies like AXA to signal that investing in an industry that kills its customers is simply the wrong thing to do," UICC's chief executive Cary Adams said. 

"This announcement to divest €1.8 billion is a milestone step in the right direction," he added.