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Market Cap £10.11bn
Enterprise Value £16.38bn
Revenue £30.15bn
Position in Universe 103rd / 1050

UPDATE 1-Activist groups urge insurers to drop coverage of oil sands pipeline

Thu 8th August, 2019 10:34pm
(Adds response from Zurich, final paragraph)
    By Valerie  Volcovici
    WASHINGTON, Aug 8 (Reuters) - A coalition of 32
environmental and indigenous groups on Thursday urged insurers
to stop underwriting the Trans Mountain pipeline to pressure
Canada to cancel its plan to expand the project, which carries
crude from Alberta's oil sands to British Columbia's Pacific
    Self-insurance by the government for the expansion would
cost taxpayers C$1.1 billion, the groups said. 
    Pressure is growing for financial companies to pull back
from insuring and investing in polluting industries like coal
and oil as part of an effort to combat climate change.
    The coalition sent a letter to 27 companies registered to
insure the pipeline, including Munich RE  MUVGGR.UL , Talanx
 TLXGn.DE  and Zurich Insurance Group AG  ZURN.S , asking them
to drop their coverage before Aug. 31, the deadline for Canada
to renew its liability insurance.
    The groups said they hope the pressure "will show the
Canadian government that the expansion is uninsurable."
    The Canadian government bought the pipeline from Kinder
Morgan to help clear crude transportation bottlenecks for
landlocked Alberta crude. Environmental activists say the
project will undermine Canada's commitment to reduce greenhouse
gas emissions 70% below 2005 levels by 2030 under the Paris
climate agreement.
    "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," the groups told the
insurers in the joint letter. 
    The activist groups include Stand.Earth, the Union of BC
Indian Chiefs, German NGO Urgewald, the Rainforest Action
Network and Greenpeace International.
    Last month Chubb Ltd  CB.BN   CB.N  became the first U.S.
insurer to say it would no longer sell policies to or invest in
companies that make more than 30% of their revenue from coal
mining. This follows the lead of some of Europe's biggest
insurers and financial institutions, including Allianz Finance
Corp  ALVGLZ.UL , AXA  AXAFD.UL , Lloyds Banking Group  LLOY.L 
and Zurich Insurance Group  ZURN.S , which have placed
restrictions on coal underwriting. 
    The groups said they would ramp up pressure on Zurich, which
told the campaigners in a letter last week it would continue
insuring the Trans Mountain Pipeline while it discusses with the
Canadian government how to meet its Paris climate agreement
targets with the pipeline in place. 
    In June, Zurich had pledged to begin to divest from the oil
sands industry, starting with dialogue about transition plans
with their customers that have over 30% exposure to thermal
coal, oil sands and oil shales. 
    "By renewing coverage of the Trans Mountain Pipeline, Zurich
betrays its own commitments," Lucie Pinson, of the Unfriend Coal
campaign, said in a statement on Thursday.
    Pavel Osipyants, a spokesman for Zurich, said insuring the
pipeline does not betray its pledge because Zurich "will either
facilitate a transition to an alternative insurer (stop insuring
them) or continue to provide insurance coverage" for the
pipeline company depending what it learns about its strategy and
position on climate change risk after their dialogue.

 (Reporting by Valerie Volcovici; Editing by Richard Chang and
Dan Grebler)
 ((valerie.volcovici@thomsonreuters.com; +1-202-898-8300))
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