In a series of letters issued late last month, a group of 32 environmental, Indigenous, and citizens’ organizations led by Stand.earth is demanding commitments from more than two dozen major insurance companies to stop underwriting tar sands/oil sands projects, beginning with the Trans Mountain pipeline expansion.
The five-page letter states that each of the companies is listed on Trans Mountain’s certificate of insurance, with policies that are up for renewal August 31. “Considering the risks of this project, we are writing to request that your company not renew this policy and rule out any insurance services for all aspects of the Trans Mountain Pipeline,” Stand writes.
“Oil sands expansion and proposed pipelines like Trans Mountain are arguably the most contentious environmental projects in Canadian history,” and “of major concern is the impact the growth of the oil sands would have on climate change,” the letter adds. “Emissions from oil and gas production are one of the primary reasons Canada cannot meet its Paris commitments,” and “now represent the largest and fastest growing source of emissions in Canada”—even before factoring in a recent estimate in the journal Nature that tar sands/oil sands emissions have been under-reported by 13 to 123%.
“Despite these serious climate impacts and their impact on Canada’s Paris Accord commitments, the oil sands industry plans to nearly double the size of the oil sands in the next 20 years,” the letter notes. “Providing insurance services to a project that would allow exponential growth of the oil sands, effectively removing any remaining chance of Canada staying within the goals of the Paris climate change agreement, would critically undermine the continued viability of your industry.”
On its website, Stand explains that “increasingly, the insurance industry is becoming aware that climate change is an existential threat to its entire business model. Insurance payouts for damage caused by climate-related severe weather events, from hurricanes to wildfires, have increased exponentially in the past decade and are only growing year after year.” Some of the world’s biggest insurers have responded by cutting off coverage for coal and, more recently, tar sands/oil sands projects.
The website lists the 27 companies that received the letter and their responses so far. “Self-insurance by the government for the expansion would cost taxpayers US$1.1 billion,” Reuters reports.