French insurer AXA is selling its €1.8 billion worth of assets in the tobacco industry and will stop investing in the sector altogether.

The French insurer is citing the impact of smoking on public health as its reason behind the major move.

It will divest its €200 million of equity holdings in tobacco companies immediately, according to Reuters, and plans to run off existing holdings.

Incoming chief executive Thomas Buberl said:

"With this divestment from tobacco, we are doing our share to support the efforts of governments around the world.

"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".

The company added that the cost of smoking to society is greater than that of alcohol or obesity, noting that tobacco kills six million people a year – a figure expected to rise to eight million (mostly in developing countries) by 2030.

In the same statement, Cary Adams, the head of the Union for International Cancer Control (UICC), said:

"We need companies like AXA to signal that investing in an industry that kills its customers is simply the wrong thing to do.

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