Marsh launches insurance facility for green and blue hydrogen project risks
Marsh announced the launch of a first-of-its-kind insurance and reinsurance facility that provides dedicated insurance capacity for new and existing green and blue hydrogen energy projects. Developed by Marsh in collaboration with insurers Liberty Specialty Markets, part of Liberty Mutual Insurance Group, and AIG, the facility provides up to $300 million of coverage per risk for the construction and start up phases of hydrogen projects globally.
Investment in green and blue hydrogen initiatives is estimated to exceed $150 billion by 2025 as traditional energy operators, governments, and hard-to-abate industries race to meet their carbon reduction obligations. However, operators have found it particularly challenging to secure adequate insurance market provision for these new and emerging technologies.
Marsh’s facility is backed by a panel of A-rated global insurers, led by Liberty Specialty Markets and AIG. It provides capacity up to US$300 million per risk and is structured flexibly to enable clients – from small operators to multinational organizations – to choose coverage for the construction or startup 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 includes marine cargo, business interruption, general third party liability, and contingent delay-in-start up insurance.
“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.” – Andrew George, Global Head, Energy & Power, Marsh Specialty.
“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.” – Lesley Harding, Global Head of Energy at Liberty Specialty Markets.
“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. 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.