"This innovative solution is one of many initiatives that we are working on with our clients and broker partners in support of the energy transition and our net zero commitments."
- James Langdon, AIG UK head of energy and construction
Currently, investment in green and blue hydrogen initiatives is estimated to exceed $150bn by 2025 as traditional energy operators, governments, and hard-to-abate industries race to meet their net zero goals and carbon reduction obligations. However, operators have found it particularly challenging to secure adequate insurance market provision for these new and emerging technologies.
The launch of the world’s first green and blue hydrogen facility, developed by Marsh in collaboration with insurers Liberty Special Markets, part of Liberty Mutual Insurance Group, and AIG, will provide up to $300m of cover per risk for the construction and start-up phases of hydrogen projects globally.
This cover has been structured flexibly to allow clients – from small operators to multinational organizations – to choose from coverage for the construction or start-up phase, or a combined risks policy that extends to first-year operations.
As well as providing risk transfer options for all construction and operational phase property damage risks, the facility also offers marine cargo, business interruption, general third-party liability, and contingent delay-in-start up insurance.
Commenting on the launch, Andrew George, Marsh Specialty global head energy & power, has said:
“Marsh’s facility is an important development for the insurance industry that will help enable the acceleration of the global energy transition to renewables. As the global hydrogen industry, especially green hydrogen, scales up rapidly to meet demand, the facility will reduce the complexity of securing risk transfer options for operators of all sizes and boosts investor and lender confidence in achieving their ambitious project timeframes.”
“Marsh continues to make significant investments in supporting the diversification of energy systems and is challenging insurance markets to keep pace with industry and improve risk management approaches and choices. We are committed to working with investors through all phases of their projects, to support their energy transition goals.”
Lesley Harding, Liberty Specialty Markets global head of energy, said:
“We are delighted to collaborate with Marsh to bring this solution to market. This is another example of how Liberty is providing industry-leading technical expertise to assess, quantify and underwrite emerging technology risks. Our ambition is to be the strategic insurance partner for clients engaged in the energy transition.”
James Langdon, AIG UK head of energy and construction, added:
“At AIG we are keen to elevate the industry standard, so we proactively collaborate with our partners to devise new and impactful insurance solutions in support of our clients’ changing needs.”