Aon has developed a new insurance product designed specifically for international transport and storage companies engaged in storing carbon dioxide.

The broker's energy transition product was created through its role as insurance broker to Eni UK, the lead company in the consortium delivering the innovative low carbon and hydrogen HyNet North West project (in which Eni is the transportation and storage operator), and the Northern Endurance Partnership (BP, Equinor and TotalEnergies).

This project is among the first large commercial-scale and complete carbon transportation and sequestration processes for capturing, removing and storing industrial carbon dioxide emissions – which is key to the decarbonisation of the UK’s industrial heartland.

The product has been developed acknowledging energy regulators and stakeholder expectations and in support of the assessment of available insurance coverage. While it was initially created in conjunction with a UK project, it has been designed to work for projects globally.

William Lynch, business leader for natural resources at Aon, said: “Carbon capture is a fundamental component in reducing emissions and supporting the energy transition. While challenges remain, this is a first-of-its-kind risk transfer solution, aimed at providing comprehensive cover under an agreed policy wording, for transport and storage companies engaged in CCS. Cover spans the construction and repurposing of existing assets as well as the operational phase. A huge benefit for operators and their investors, as well as their customers, is knowing what their insurance costs and coverage will be in an otherwise uncertain market.

“Aon has spearheaded the development of this product over the last 18 months, working in collaboration with leading underwriters, and the legal community and we look forward to working on many similar projects.”

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