Chubb, Liberty Mutual, Sompo revealed as insurers on Rio Grande Valley Methane Projects
(Brownsville, Texas) A recent Freedom of Information Act request revealed that Chubb, Liberty Mutual, and Sompo are the insurers behind the Rio Grande LNG project, a proposed methane gas export terminal on the Texas Gulf Coast that would annually emit the equivalent to 44 coal plants. This revelation questions their ability to protect the climate and their business model.
Environmental groups say that Chubb’s climate commitments are ahead of their peers in the US but are very far behind their European insurance counterparts, in part because their recent policies regarding methane are focused on reducing methane emissions in the fossil fuel production process but not on reducing methane gas expansion as its own fossil fuel source (more commonly known as LNG.) On the other hand, Liberty Mutual is one of the top fossil fuel insurers in the U.S. with weak or no restrictions. Finally, Sompo is a relative leader among Japanese insurers that has the opportunity to rule out Rio Grande LNG as it has with the Arctic Refuge.
An unstable climate harms the insurance industry’s bottom line, as each company has lost revenue due to catastrophic losses due in part to extreme climate change: Chubb has cited its 2023 Q1 pre-tax catastrophe losses were $458 million, Liberty’s net loss in 2023 Q2 was $585 million and Sompo recorded decline in its consolidated profit in 2023 of $838 million USD.
Despite these losses, the certificate reveals they continue to insure projects that hurt their bottom line, especially in the Gulf region where methane export facilities are among one of the biggest fossil fuel buildouts on the planet. This comes at a time when the International Energy Agency says there is no need to expand any fossil fuel infrastructure or exploration including methane gas. The Rio Grande Project, in particular, would be twice the size of Disney World if built and the largest single source polluter in the South Texas region.
Insurance watchdogs like Rainforest Action Network say that in addition to increasing insurers’ climate risk and losses, the project itself poses significant risks. It’s located near a SpaceX launch site that has caused unplanned seismic activity and rocket debris that has fallen on the site; the project has a significant amount of legal risk with regulatory gaps in FERC oversight; legal risks with the city of Port Isabel and the Carrizo/Comecrudo tribe legally challenging the facility; and human rights risk by not meeting standards of Free, Prior and Informed Consent of Indigenous peoples and violating international law.
While rarely made public, insurance certificates are valuable sources of information to assess companies’ public climate commitments and advance the shared private and public interest of addressing climate change.
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Note: this press release was corrected on Dec 13 with the correct name of the city that is challenging FERC with legal action – the city is Port Isabel. The release incorrectly attributed this action to the city of Brownsville on its 8am ET 12/13 release.