Marsh has introduced a new insurance solution designed for the transportation and storage of carbon dioxide (CO2).
The product, available to projects globally, addresses critical insurance limitations that have previously hindered the rapid advancement of the carbon capture and storage industry, according to the firm.
Created by Marsh’s Energy and Power team and underwritten by Canopius, the solution provides coverage that enables operators to meet their financial security obligations when captured CO2 is being transported and injected into suitable geological structures.
It adds a new non-damage trigger for the geological leakage of CO2, providing indemnification for the costs of corrective measures as well as a trigger for the associated business interruption.
In addition, the product also includes an indemnification for the costs incurred to acquire carbon credits for the mass of CO2 leaked, where applicable to the project's geography.
Hannah Jennings, global carbon capture and storage initiative leader, Energy and Power, Marsh Specialty, states: "Carbon capture and storage has a fundamental role to play in reducing emissions globally and delivering the net zero energy system.
“Marsh Specialty’s new solution not only represents a meaningful shift in the parameters of traditional energy insurance but also delivers greater certainty and confidence to investors, governments, and regulators.”
Sam Harrison, group chief underwriting officer at Canopius, adds: “It is our job to find solutions to address the as-yet unknown risks associated with these new, exciting technologies.
“We have decades of experience in finding solutions for traditional upstream energy resource risks, and we can put that experience to work in these new fields. Working with our partners and their clients, we can take learnt lessons and find new, innovative ways of addressing tomorrow’s challenges.”
