London, United Kingdom (CU)_ Marsh is all set to open its unique insurance and reinsurance facility that offers devoted capacity to new and current green and blue hydrogen energy projects. Marsh established the facility in conjunction with Liberty Specialty Markets, a division of Liberty Mutual Insurance Group, and AIG. It offers coverage of up to $300 million per risk for the building and startup phases of hydrogen products worldwide.
As traditional energy providers, governments, and industries work towards their goals of meeting carbon-reduction standards, it is anticipated that investment in green and blue hydrogen programs would exceed $150 billion by 2025. However, according to Marsh, operators have faced difficulty securing enough insurance market coverage for the related new and evolving technologies.
A committee of A-rated global insurers, chaired by AIG and Liberty Specialty Markets, sponsors Marsh’s facility. It is designed in a manner that allows customers to select coverage for the construction or startup period, or a combined risk policy that continues to the first year of operations. The facility offers marine cargo, business interruption, general third-party liability, and contingent delay-in-startup insurance, in addition to risk transfer options for all construction and operating phase property damage risks.
According to Andrew George, global head of energy and power at Marsh Specialty, “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 boost investor and lender confidence in achieving their ambitious project time frames.”
Lesley Harding, global head of energy at Liberty Specialty Markets, expressed delight over the collaboration. He said, “We are delighted to collaborate with Marsh to bring this solution to the 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, head of energy and construction at AIG UK, expressed optimism over the partnership. He said, “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.”
