AXIS Capital Decides to Stop Insuring Arctic Oil and Gas Projects

AXIS Capital Holdings Ltd. said it won’t insure oil and gas projects in the Arctic National Wildlife Refuge, becoming the first North American underwriter to make the commitment after pressure from native Alaskans and environmentalists.

The move follows similar pledges from France’s AXA SA and Swiss Re AG and comes as indigenous tribes that live in Alaska and Canada push investors, oil companies and insurers to end their support for Arctic oil drilling.

“We believe climate-related risks are among the most serious issues facing the world today,” Conrad Brooks, general counsel and corporate secretary of Bermuda-based AXIS Capital, wrote in a letter to the Gwich’in Steering Committee, which represents tribes in Alaska and Canada. “We also recognize the importance of the Arctic National Wildlife Refuge to you and your families, as well as our planet.”

Brooks said AXIS won’t underwrite new insurance or offer facultative reinsurance contracts, nor provide investment support for projects involved in exploration, production or transportation of oil and gas in the refuge.

The decision is one of several moves by AXIS to enhance its environmental and climate-risk strategy, Brooks said. The company has already limited underwriting of thermal coal and oil sands projects.

The rugged Arctic National Wildlife Refuge in northeast Alaska has become the latest front in a fight over oil drilling. When the Trump administration auctioned drilling rights in the refuge’s coastal plain last week, just two oil companies bid for tracts alongside an Alaska economic development corporation that spent about $12 million nabbing leases on the state’s behalf. President-elect Joe Biden has vowed to permanently protect the refuge, which is home to polar bears, caribou herds and other wildlife — and is among the fastest-warming places on the planet.

“The recent lease sale ignored all our concerns and dismissed the climate crisis, but the commitment from AXIS today shows that other companies agree with us and respect us,” said Bernadette Demientieff, executive director of the Gwich’in Steering Committee. “We need more companies to stand with us, respect our human rights and our way of life.”

Photo credit: The Trans Alaska Pipeline System (TAPS) stands near Copperville, Alaska, U.S., on Tuesday, Feb. 14, 2017. Four decades after the Trans Alaska Pipeline System went live, transforming the North Slope into a modern-day Klondike, many Alaskans fear the best days have passed. Photo credit: Daniel Acker, Bloomberg