Aon Unveils Industry-First Insurance For Carbon Capture

Aon Unveils Industry-First Insurance for Carbon Capture - Carbon Herald

Global insurance leader Aon has launched a new insurance product specifically designed for companies involved in carbon capture and storage (CCS) on an international scale. 

This innovative solution tackles key risks associated with CCS projects.

Aon‘s goal is to transform the insurance landscape for CCS by mitigating risks and making these projects more attractive to financiers and investors. 

This will not only fill a critical insurance gap but also redefine what types of projects can be insured.

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Aon explained that CCS plays a vital role in environmental, social, and governance (ESG) efforts, and by capturing and storing CO2 emissions, CCS helps energy and industrial sectors achieve their net-zero goals.

Aon’s experience working with Eni UK, a leader in the low-carbon HyNet North West project, and the Northern Endurance Partnership (NEP) – a consortium including bp, Equinor, and TotalEnergies –  informed the development of this new insurance product.

William Lynch, business leader for natural resources at Aon, commented: “Carbon capture is a fundamental component in reducing emissions and supporting the energy transition. While challenges remain, this is a first-of-its-kind risk transfer solution, aimed at providing comprehensive cover under an agreed policy wording, for transport and storage companies engaged in CCS.

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“Cover spans the construction and repurposing of existing assets as well as the operational phase. A huge benefit for operators and their investors, as well as their customers, is knowing what their insurance costs and coverage will be in an otherwise uncertain market.

“Aon has spearheaded the development of this product over the last 18 months, working in collaboration with leading underwriters and the legal community, and we look forward to working on many similar projects.”

Aon has spearheaded the development of this product over the past year and a half, collaborating with leading insurance underwriters and legal experts. 

The company looks forward to supporting many similar projects in the future.

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