Campaigners are set to launch a week-long campaign to target the insurers of a controversial tar sands pipeline as one Lloyd’s insurer announced it would not renew its policy from August.
Argo Group has written a reply to a request to one climate group to clarify its role in the coverage of the Trans Mountain tar sands pipeline by saying it will not renew the cover which expires on 31 August.
In an email to Public Citizen, Argo stated: “We currently insure the Trans Mountain pipeline, but do not intend to renew it when the policy expires in August 2021. This type of project is not currently within Argo’s risk appetite.” Argo further clarified that it also does not intend to insure construction or operation of the Trans Mountain Expansion Project.
Climate campaigners said the project will do irreparable harm to the environment.
“If built, the Trans Mountain Expansion Project would transport an additional 590,000 barrels of tar sands oil per day from Alberta to British Columbia, and lead to a 700% increase in oil tankers in the Salish Sea. Many Indigenous communities have consistently and repeatedly rejected the Trans Mountain pipeline and tanker project – but the Canadian government continues to plough ahead with construction,” they explained.
However, while they have welcomed Argo’s decision campaigners are set to launch a week-long campaign against those insurers they say are still participating in the coverage of the firms involved in the construction.
The Stop Insuring Trans Mountain Week of Action, taking place from 14-21 June. Over the course of the week, organisations and activists from the US to Germany to Sierra Leone will be targeting what have been described as “the likely insurers” of Trans Mountain – which include insurance giants AIG, Chubb, Liberty Mutual, and Lloyd’s of London – urging them to follow Argo’s lead and stop insuring Trans Mountain’s “destructive, rights-violating pipelines”. They added Trans Mountain is currently seeking to secure coverage for 2021-2022, with the support of its broker Marsh.
In February 2021, the Canadian-owned Trans Mountain corporation petitioned the Canada Energy Regulator to keep the names of its insurance backers secret, stating that it had “observed increasing reluctance from insurance companies to offer insurance coverage for the Pipeline and to do so at a reasonable price.” The Canada Energy Regulator approved the request on April 29, 2021, and Trans Mountain’s most recent insurance certificate was publicly filed with the insurance company names redacted.
“We commend Argo and the other insurers for leading the way by dropping Trans Mountain. In addition to fueling the climate crisis, this pipeline represents an ongoing violation of Indigenous rights. The lack of Free, Prior and Informed Consent is a material risk that most insurers have not fully captured, and that needs to change. We are calling on the rest of the Lloyd’s syndicates, as well as AIG, Chubb and Liberty Mutual to follow Argo’s path,” said Charlene Aleck of the Tsleil-Waututh Nation Sacred Trust Initiative.
“The Trans Mountain pipeline is too risky to go forward. Argo Group’s decision to drop the project is just the latest in the long line of clear signals that this pipeline is a danger to the climate, Canada’s west coast, and the communities it runs through. The only remaining question is when will the Trudeau government catch up to Argo, and the growing number of major insurers, that have acknowledged that this project does have a place in a climate-safe world,” said Sven Biggs, Canadian Oil and Gas Program Director at Stand.earth.
The climate groups said insurers are rapidly recognising the massive risks with the aging Trans Mountain pipeline and the oil expansion project, which would increase emissions equivalent to adding 2.2 million cars to the road and has been continuously delayed in the face of fierce Indigenous-led resistance.
“More than ten insurance companies have now specifically ruled out coverage for the company or adopted tar sands exclusion policies that restrict involvement, as insurance support for the tar sands sector dwindles,” it added.
In summer 2020, Trans Mountain’s lead insurer, Zurich, dropped Trans Mountain after sustained campaigning from Indigenous leaders and climate advocates, as did German insurers Talanx and Munich Re. Canada’s Energy Regulator and the recent International Energy Agency report have both made clear that the Trans Mountain expansion project and any expanded oil and gas infrastructure is incompatible with global climate targets.
In addition to Argo, Lloyd’s syndicate Lancashire Group stated last month that it did not insure Trans Mountain and did not intend to do so in the future: “The Group does not have an appetite for underwriting direct insurance exposure for the Trans Mountain pipeline. The Lancashire Syndicates will be closely adhering to the Lloyd’s market policy on fossil fuel insurance.”
Lindsay Keenan, European Coordinator for Insure Our Future, said “Argo’s commitment to not renew insurance of Trans Mountain should be a signal to the rest of the Lloyd’s market to follow suit. Lloyd’s CEO John Neal needs to make a clear statement on behalf of all of Lloyd’s members that no Lloyd’s syndicate shall renew insurance for any aspect of the Trans Mountain tar sands pipeline.”