Insurance companies should not insure new fossil fuel development

What are examples of the type of proposed projects that the insurance industry should be avoiding? To start, it should not be insuring new drilling in Alaska’s arctic.

Ken Madsen | Used by permission

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Green Century Capital Management filed shareholder resolutions with three big U.S. insurance companies — Travelers, Chubb and The Hartford – asking shareholders to vote that their companies should not insure new fossil fuel development. Insurance companies are meant to protect against calamity in our society and the worsening of climate change caused by burning fossil fuels is certainly a calamity. 

What are examples of the type of proposed projects that the insurance industry should be avoiding? To start, it should not be insuring new drilling in Alaska’s arctic. 

The coastal plain of Arctic National Wildlife Refuge is teeming with life from migratory birds to thousands of caribou to a struggling population of polar bears who are fighting for survival against climate change. The coastal plain is sacred to the Gwich’in who call it “Iizhik Gwats’an Gwandaii Goodlit” (The Sacred Place Where Life Begins). After pushing for decades to be allowed to drill, oil companies got one step closer in 2017 with the passage of the Tax Act, which authorized the coastal plain oil and gas program. But following a failed lease sale in 2021, four oil companies have actually pulled out of the refuge, making us question whether there’s actually any interest in drilling there at all. Committing to deny insurance for coastal plain drilling should be an easy commitment to make. In fact, 17 international insurers have already committed not to insure drilling in the refuge.

To the west of the refuge, ConocoPhillips, Alaska’s largest crude oil producer has proposed the Willow Project. If allowed to move forward, it will be the single largest oil extraction project on U.S. federal land. The rising temperatures associated with climate change have made fossil fuel extraction more difficult and costly due to melting permafrost. The financial losses that oil companies would incur should discourage drilling in the arctic. However, ConocoPhillips plans to refreeze the tundra using “chillers” and then proceed to drill it for oil. The proposed 30 years of oil drilling from the Willow Project would extract 500 million barrels of petroleum from this snowy sanctuary. The project would single-handedly release annual emissions equivalent to more than 70 new coal fired power plants operating in a given year.

If shareholders for these three companies vote in favor of Green Century’s resolution, they will be making it that much harder for oil companies, including ConocoPhillips, to move forward with their plans to drill in the arctic. That will be good news for the caribou, birds, polar bears and Indigenous peoples in the arctic and good news for the entire planet; we don’t need more oil drilling. And you can’t drill for oil without insurance. 


Ellen Montgomery

Director, Public Lands Campaign, Environment America Research & Policy Center

Ellen runs campaigns to protect America's beautiful places, from local beachfronts to remote mountain peaks. Prior to her current role, Ellen worked as the organizing director for Environment America’s Climate Defenders campaign. Ellen lives in Denver, where she likes to hike in Colorado's mountains.

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