Rising prices for fossil fuels are inflating the value of assets handled by companies involved in the production and transportation of crude oil, oil derivatives and gas. If not addressed in insurance policies this may leave some players in the energy sector underinsured as asset values exceed insurance limits.
Countries putting in place ambitious greenhouse gas emissions reduction targets are increasingly finding that hydrogen will play a major part in their plans. While over 30 countries have already produced hydrogen roadmaps in the world, Chile is among those best positioned to produce this energy sustainably at large scale. However, as with all large and innovative projects, potential risks need to be closely monitored and addressed, not least to get the necessary support from insurers.
The insurance industry is aware of the risks that climate change represents to its business in form of floods, storms and wildfires and is reducing its exposure to fossil fuels both in underwriting as well as investments. The pressure on oil and gas companies to transition to a more sustainable and climate friendly energy sector has increased substantially in recent years.The Covid-19 pandemic might provide the final push.