Insuring Oil: Why Top London Firms Are the Target of Protest
Climate activists have taken their fight against environmental destruction straight to the heart of London's financial district.
Protesters occupied the offices of top insurers Allianz, Hiscox and Chubb, staging a mass "die-in" outside the iconic headquarters of Lloyd's of London, demanding an end to support for the East African Crude Oil Pipeline (EACOP), the longest of its kind in the world.
The rationale behind the protests is simple: the project cannot continue without insurance to protect it. What's more, many insurance firms have already pulled out of the project because of pressure from environmental groups.
The EACOP Project: A flashpoint for controversy
The activists' primary target is the planned construction of the East African Crude Oil Pipeline (EACOP), an almost 900-mile pipeline stretching from Uganda to Tanzania. Nicholas Omonuk Okoit from the End Fossil Occupy Uganda group spoke outside the Hiscox headquarters, which provides coverage for the EACOP project.
"We are going through injustice because of corporations – because of corporate neo-colonialism," he said. "European countries are profiting from African resources at the expense of people and the planet."
But what are the specifics of the project and what makes it so egregious to East African citizens?
The controversies surrounding the EACOP
The East African Crude Oil Pipeline (EACOP) project has been surrounded by several major controversies:
Environmental concerns
- It threatens sensitive ecosystems, including protected areas and internationally important wetlands
- The project could significantly degrade nature reserves crucial for endangered species like elephants, lions and chimpanzees.
- It risks contaminating water resources that millions of people rely on, including the Lake Victoria basin, one of the world's largest lakes.
- The pipeline is projected to generate 379 million tonnes of CO2 equivalent emissions over its lifetime, exacerbating climate change.
Human rights issues
The project will displace over 100,000 people from their land.
- Many affected communities report receiving inadequate compensation and feeling pressured to sign agreements they don't fully understand.
- Critics of the project have faced intimidation, threats and detentions.
- At least 47 campaigners in Uganda have been detained for speaking out against the pipeline since 2020.
Economic concerns
- Most contracts have gone to foreign companies, with local firms playing only minor roles.
- Job creation estimates have been drastically reduced from tens of thousands to only about 3,500 permanent jobs.
- TotalEnergies will receive a 10-year tax exemption, limiting revenue for host countries.
Financial Challenges
Many major international banks have publicly withdrawn support due to environmental and social concerns.
- Insurance companies are also increasingly refusing to back the project, which is why protestors are targeting those insurers still involved.
The latest in a series of protests against insurers
Campaigns designed to put pressure on the insurance and insurtech industries have been running for a long time already, in an effort to get them to divest from fossil fuel projects that cause environmental degradation. A similar demonstration took place in March 2024, where the premises of Marine, Talbot/AIG, Zurich, Probitas and Travelers were targeted.
In March, Ilana Winterstein, a spokeperson from the 'Insure Our Futures' campaign, said the groups' aims were to "spotlight the key role the insurance industry plays in the climate crisis.
"Without insurance, fossil fuel projects can’t operate – and to highlight that insurers could be the unlikely heroes the world needs if they act now and stop insuring fossil fuel expansion."
These most recent protests come after an ultimatum was published by Extinction Rebellion earlier in October 2024, calling for the UK's major insurers to dump their clients pursuing fossil fuel projects. Now, since the group's deadline has expired without response, the protests have begun. Crisis24, an organisation which helps to safely organise demonstrations, say that further peaceful actions will follow shortly.
Insurers pressured into changing policy: the efficacy of protest
The insurance industry is under increasing pressure to address its role in the climate crisis. Environmentalists at the demonstration, believe protests can have a tangible impact on this situation, with one of them saying: "they are learning that insuring fossil fuels means that other infrastructure will not work. Floods and storms will destroy the infrastructure and they will be paying out in infrastructure insurance."
In truth, this approach has worked in the past. Allianz (which is the main target of these protests too) cut back its investment in and insurance of coal projects in the mid 2010s, as a result of pressure from environmentalists. Then-CEO, Oliver Baete, said after this rollback: "As a leading insurer and investor, we want to promote the transition to a climate-friendly economy."
Other companies in the insurance industry have responded to the mounting pressure too. In February, XR blockaded Lloyd's and occupied the buildings of other insurance companies, including Probitas. Shortly afterward, Probitas agreed not to insure EACOP or the West Cumbria coal mine, which was blocked by a High Court judge in September. Probitas had already backed out of insuring the Adani coal mine in Australia last year.
These protests raise a lot of tough questions for the insurance industry. Zurich Insurance, who were the targets of similar protests in April 2024, announced its disavowal of oil and gas projects as a result of public scrutiny. Sierra Signorelli, CEO of Commercial Insurance at Zurich, said that the company's policy shift reflected the "disconnect" between fossil fuel projects and and the insurer's overall goal of achieving net zero emissions by 2050.
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