Mosaic Introduces Oil Well Remediation Liability Coverage
PRODUCT: Plug-and-Well Exit Liability Insurance.
COMPANIES: Mosaic Insurance; Aon.
BEST RATING: A+
AVAILABILITY: Appointed agents and brokers only.
FOCUS: Mosaic Insurance has developed a pioneering climate solution to support the growing number of companies working to remediate abandoned and orphaned oil and gas wells across North America.
In the U.S., there are between 1 million and 3 million wells no longer in production and not properly sealed, according to the U.S. Environmental Protection Agency. Some are abandoned by known owners or operators, while others are described as orphaned, where no responsible party can be found—perhaps because they have gone bankrupt or the business no longer exists and leaving responsibility in the hands of state, provincial or federal government entities. These old wells are leaking methane, a greenhouse gas far more potent than carbon dioxide.
“Mosaic is proud to be at the forefront of supporting companies tackling this urgent challenge that enables real progress on climate mitigation,” says Karen Reilly, head of Americas, environmental liability, Mosaic. “Our innovative, responsive coverage brings certainty to the many liabilities involved. By doing so, Mosaic is helping unlock the growth of projects that directly reduce greenhouse gas emissions—a win for our partners, our industry and the planet.”
While traditional contractors pollution liability (CPL) insurance typically covers pollution events and control of well (COW) covers, well control and redrill costs, neither fully addresses the needs of orphaned well remediation projects. Mosaic created a tailored solution that combines the two, offering more comprehensive protection for this evolving risk.
COVERAGE DETAILS: The tailored solution combines core CPL coverage with a limited COW extension and offers more comprehensive protection for this evolving risk. The coverage ensures that if, for whatever reason, a capped well starts leaking again, funds will be available to re-plug it. And if plugging activities lead to contamination of land or water, the coverage will limit the contractor’s liability—paving the way for greater certainty.
UNDERWRITING: Based on an analysis of revenues, contractor operations, risk management practices and loss history.
COVERAGE AVAILABILITY: North America.
TARGET: Project owners, well-plugging contractors and buyers of carbon credits generated from well-plugging operations.
CONTACT: Maxwell Horn, senior vice president, environmental liability, Mosaic Insurance; 215-740-3601.
Will Jones is IA editor-in-chief.
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