The insurance giant is a key backer of the tar sands sector
This post by Elana Sulakshana originally appeared on The Understory, the blog of Rainforest Action Network.
Liberty Mutual spends hundreds of millions of dollars every year advertising their insurance coverage for homes, cars and more. For the general public, they don’t advertise that they also insure multinational fossil fuel companies and coal mines. In fact, Liberty Mutual is one of the top insurers of fossil fuels, providing insurance coverage for dirty energy projects in the U.S. and around the globe. That’s why RAN and allies are campaigning on Liberty Mutual, calling on the insurance company to stop insuring fossil fuels and human rights abuses.
Since we launched the campaign back in October 2019, Liberty Mutual has already responded by limiting coal insurance and investing. However, the Boston-based insurer continues to be a huge backer of the tar sands oil sector. The tar sands (also known as oil sands) of Alberta, Canada are infamously toxic and carbon-intensive oil reserves. From extraction to transport to refining, tar sands projects poison local ecosystems and communities, pose grave threats to Indigenous rights, and fuel climate change.
Current tar sands production is restricted by a pipeline bottleneck, which means that the future of increased tar sands extraction depends on three proposed pipelines: Trans Mountain, Keystone XL, and Line 3. Construction is continuing on these pipelines, despite the COVID-19-related public health risks facing communities and tribes in their path, to say nothing of the health risks to workers being ordered to build these pipelines. Plunging ahead with business-as-usual construction also ignores the price of tar sands oil plunging in the current virus-driven economic recession, meaning these new pipelines could well be stranded assets soon after they’re built.
Rather than exploit the tar sands sector for its last drops of profit and threaten the health and safety of communities along pipeline routes, Liberty Mutual should stop backing the sector and accelerate a just transition for the workers and communities.
How is Liberty Mutual supporting the tar sands sector?
- Liberty Mutual is an insurer of the Trans Mountain tar sands pipeline in Canada. Two subsidiaries of Liberty Mutual are providing more insurance coverage than any other major insurance company. This means that Liberty Mutual is lined up to insure the pipeline expansion, which would carry hundreds of thousands of barrels of tar sands oil, lock in expanded production of Alberta tar sands, and pose a grave threat to Indigenous rights. First Nations that would be directly impacted by the new pipeline route are leading fierce resistance on the ground and in the courtrooms. Liberty Mutual’s willingness to insure this pipeline reflects the fact that the company has no policies in place to steer clear of projects that have not secured the Free, Prior, and Informed Consent of Indigenous communities.
- Liberty Mutual is providing key financial coverage to TC Energy to build the Keystone XL pipeline. Liberty Mutual has provided a $15.6 million bond to cover risks related to the construction of Keystone XL through South Dakota. Keystone XL would carry tar sands from Alberta, Canada down through the U.S., even though it has not secured the consent of impacted Indigenous nations and other communities along the route. A second $15.6 million bond will be required after construction starts, which is supposedly imminent. If Liberty Mutual is providing these bonds, it’s likely that it is also providing crucial insurance coverage to TC Energy and the pipeline itself and facilitating the expansion of tar sands.
- Liberty Mutual may be supporting Line 3. We don’t know this for sure – the fossil insurance industry is opaque, by design, and there isn’t yet publicly available documentation of what insurers are backing Line 3. But given Liberty Mutual’s support for Trans Mountain and Keystone, it’s reasonable to assume they’re supporting Line 3, until and unless they put in place a policy that rules out tar sands.
- Liberty Mutual also invests in tar sands companies. The insurance giant has at least $8.9 billion invested in fossil fuel companies, including those that are expanding infrastructure to mine and move tar sands like TC Energy.
- Liberty Mutual adopted a new policy to restrict coal insurance and investing in December 2019. However, the company has not said anything publicly about tar sands, or any type of oil and gas. The adoption of a coal policy shows that Liberty is listening to us closely, and so we need to turn up the heat to get them out of tar sands too.
What are we demanding that Liberty Mutual do?
- We’re calling on Liberty Mutual to:
- Drop insurance coverage of Keystone XL and Trans Mountain.
- Rule out insuring Line 3 and the entire tar sands sector. That means no insurance for tar sands extraction and transport projects and companies that are active in the tar sands supply chain.
- Divest from tar sands companies.
- In addition to exiting the tar sands sector, Liberty Mutual should adopt a policy to not insure companies that seek to build projects without the Free, Prior, and Informed Consent of impacted Indigenous Peoples globally, as articulated in the United Nations Declaration on the Rights of Indigenous Peoples.