This study investigates whether corporate environmental, social, and governance (ESG) activities enhance or hinder operational efficiency in the insurance industry, a sector widely regarded as inherently aligned with sustainability objectives. Contrary to the common expectation that ESG activities improve operational performance, our results show that insurers with higher ESG scores tend to exhibit lower business efficiency, particularly in terms of pure technical efficiency. This negative association persists when one-year lagged ESG measures are considered. We also provide evidence that while ESG activities are found to contribute to risk management and, in some cases, financial performance,these benefits do not translate into improvements in operational efficiency in the short term. Our findings suggest that ESG initiatives in the insurance industry may involve substantial operational and organizational costs that outweigh their efficiency-enhancing effects, at least in the near term.