RAN notes this pullback appears to be part of a “positive pattern” of the major insurer cutting ties with fossil fuel projects. (Credit: Bo/Adobe Stock)
Activist groups have been applying pressure on insurance companies to bail on coverage for projects that they feel are worsening climate change. It appears that pressure may be working, as documents obtained by the Rainforest Action Network (RAN) show Chubb no longer insures the Calcasieu Pass Liquefied Natural Gas (LNG) terminal in Louisiana.
In February, RAN published a report claiming an investigation revealed which insurers provided coverage for the project. The list included Chubb subsidiary ACE American Insurance Company, which RAN says previously had a $1.5 billion primary insurance policy for the terminal.
RAN notes this pullback appears to be part of a “positive pattern” of the major insurer backing away from fossil fuel projects. This includes Chubb recently cutting ties with the planned Rio Grande LNG and advising it will not insure the East African Crude Oil Pipeline.
Chubb is the first U.S. insurer to implement a methane policy. In March 2023, it announced a new suite of policies restricting the underwriting of oil and gas extraction (i.e. fracking) based on conservation and methane emissions criteria.
In a press release about the policies, Chubb CEO Evan Greenberg said, “The methane-related underwriting criteria that Chubb has adopted — the first of their kind in our industry — are focused on the balance between the need to transition to a low-carbon economy and society's need for energy security. As a company, we are accelerating and expanding our climate-related initiatives without committing to sweeping net-zero pledges for which, in our judgment, there is not a viable path to achieve. We will continue to pursue in earnest a responsible, realistic and science-based approach. Implementing these underwriting criteria encourages oil and gas producers to adopt technologies to reduce GHG emissions in extraction. We know that many of our clients in the industry are already committed to limiting methane emissions and we will work to expand those commitments."
In 2024, Chubb expanded the policy to include midstream projects like pipelines and LNG terminals. These standards state Chubb will not insure new projects of this type in protected areas or that don’t meet specific criteria to reduce methane emissions.
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