Lloyd’s of London member Arch Insurance has committed to no longer insure the Trans Mountain tar sands pipeline after its current insurance policy expires this summer. Arch joins seventeen insurance companies, including fellow Lloyd’s syndicate Aspen most recently, that have dropped Trans Mountain or vowed not to insure the Trans Mountain Expansion Project.
Amid pressure from activists to break ties with the tar sands pipeline expansion, in an email to Coal Action Network, a spokesperson for Arch stated:
“We can confirm that Arch Capital Group Ltd, on behalf of its underwriting operations, will not issue any future insurance policies covering the Trans Mountain Pipeline.”
Trans Mountain experienced firsthand the impacts of climate chaos in 2021. Following historic wildfires in the summer, November brought extreme flooding and mudslides that shut down the existing line for three weeks. This resulted in over two months of lower capacity oil flow.
More than 18,000 people were displaced from their homes in the climate catastrophe.
Trans Mountain pipeline expansion faces severe flooding and river crossing risks which should make insurers run a mile.
Equipment and generators were submerged in the flooded Coquihalla River; then the storms of November 2021 hit, adding half a billion dollars to the project cost.
Despite this, TMX continues to operate recklessly in flood-risk zones according to Ian Stephe of the WaterWealth Project :
"The company is recklessly setting the stage for further problems at the Vedder River crossing in Chilliwack where the river overflowed dikes. The company filed a geotechnical report that was withheld during route approval hearings and that only finds this major river crossing feasible as planned based on assumptions that were outdated when the report was written and that remain unmet. As a community member with a long history on this project, I am concerned about the impacts from this pipeline on waterways, and insurers should be too."
Charlene Aleck of the Tsleil-Waututh Nation Sacred Trust Initiative raised the question; who will fund a project this as risky as TMX?
"As the 18th insurer to rule out Trans Mountain, Arch is confirming that fossil fuel projects without Free Prior and Informed consent are a material risk. Trans Mountain's steps to keep their insurers secret will not stop the momentum towards a safer and more just world. Trans Mountain is currently looking for more financing to continue construction, but who will fund such a risky project?"
According to the last insurance certificate with company names listed, Lloyd’s syndicates collectively were the biggest insurer for Trans Mountain. Chubb and Zurich were the biggest individual insurers listed providing coverage, but since then, both Chubb and Zurich have cut ties, making Lloyd’s a remaining top target.
By refusing to rule out Trans Mountain across its marketplace, Lloyd’s of London is failing its members and the millions of people whose lives are being destroyed by climate change. With their understanding of risk, why hasn't the industry taken action decades ago?
With Arch and Aspen cutting ties, Beazley and CNA Hardy are the prime targets for public pressure.
This could all be avoided if Lloyd’s ended insurance for fossil fuels across its marketplace.
Lloyd’s of London has increasingly been the target of protests in the UK for its connection to the pipeline in the lead up to Lloyd’s of London actual Annual General Meeting on May 19. Resistance has included 60 people from Extinction Rebellion blocking the entrances at their iconic headquarters last month and a climate memorial led by Pacific Islanders and youth strikers from climate change-affected communities.
Delayed by over a decade of powerful Indigenous-led resistance, court cases, corporate campaigning, construction mishaps, and cost overruns, TMX is on it's knees. Matt Reml, (Lakota) Mazaska Talks says:
“Thanks to the effort of frontline Indigenous communities and grassroots activists, Lloyd’s of London syndicate Arch Insurance joins a growing list of insurance companies committing to no longer providing insurance for the Trans Mountain tar sands pipeline. This is a victory for Indigenous rights, environmental and climate justice. It is time for the Trudeau administration to end the Trans Mountain pipeline."
The projected cost of the Trans Mountain expansion project has quadrupled, according to recent numbers from the Canadian Ministry of Finance. The current price tag is approximately CA$21.4 billion, and the federal government pledged that it would not provide any additional funding. This leaves the budget $8.8 billion CAD short, demonstrating overwhelming opposition and challenges to building oil and gas pipelines.
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