Developments in Insurance Services to Facilitate CO2 Geological Storage

Overview

This report expands upon the 2024 IEAGHG review of insurance coverage for CO₂ geological storage projects, responding to the rapid acceleration of CCS activity and the growing commercial importance of insurance in project development. The pace of CCS activity has accelerated quickly, with new conferences, reports, commercial announcements, and technical progress emerging almost weekly, including a series of CEM/GA/OGCI workshops which has focused specifically on insurance gaps and advances. The aim of this edition is to provide a more comprehensive reference document that supports informed decision making across industry stakeholders—technical experts, insurers, developers, regulators, and financiers—while opening pathways to deeper research and helping developers prepare the data and messaging needed to secure insurance coverage and strengthen the commercial basis for geological carbon storage projects.

Key Findings

• Recently the insurance sector has supported a surge of constructive activity around carbon capture and storage (CCS) projects. Brokers, carriers, reinsurers, the Lloyd’s market, and government entities have each advanced important pieces of the insurance ecosystem, collectively helping to enable the scale-up of an integrated commercial CCS business, or “value chain”. These roles are explored in the report.
• Private-sector insurance products covering most parts of the CCS value chain are available through a suite of existing oil-and-gas-derived policies, that can be utilized or modified to address project specific requirements. A single standardized policy covering the entire CCS value chain does not yet exist but remains an industry objective.
• Brokers and carriers are both actively developing new offerings in anticipation of future growth in CCS deployment, positioning themselves for anticipated growth in demand as more carbon storage projects transition toward commercial deployment and further private-sector financing.
• Policy terms and pricing are typically treated as business-confidential and are almost never disclosed in public forums or knowledge sharing settings. For storage projects, insurers emphasize that coverage conditions and premium levels are highly project-specific and are negotiated only after a detailed technical assessment of elements such as local geology, wells, monitoring strategy, regulatory framework, and long-term liability structure.
• Publicly available information and market-participant feedback indicate that demand for storage-specific insurance remains at an early stage. While commercial products and adapted conventional covers are available, the volume of publicly documented placements remains limited, and availability, capacity and terms continue to be highly project specific. Although long-term scale-up is still expected, the number of commercial projects seeking private-sector insurance does not yet appear sufficient to meet insurance industry revenue expectations. Activity remains in an investment and market-building phase: brokers are earning fees for advisory and placement work, but carriers are not yet seeing premium volumes large enough to support a fully established class of business. Further project deployment is likely to improve the availability of operational data and support continued development of insurance capacity. Looking ahead, carriers—through initiatives such as the Geneva Association (GA), Oil and Gas Climate Initiative (OGCI) and Clean Energy Ministerial Carbon Capture Utilisation and Storage Initiative (CEM CCUS) collaboration and their own internal programs—are actively working to understand the distinctive and emerging risks associated with CO₂ storage. Their aim is to improve understanding of the risks, identify appropriate risk-allocation and risk-transfer mechanisms, and develop insurance solutions suited to project and jurisdiction-specific circumstances.
• New insurance models are currently being developed and evaluated across carrier, broker, government and legal entities.