Insurer coverage battle over climate lawsuit

Here’s an excerpt from this note by Sasja Beslik:

US fossil fuel firm sues insurer for refusing to cover climate lawsuit. A fossil fuel firm is suing its insurer for refusing to cover a climate lawsuit in a case that could affect the wider industry’s ability to defend itself from litigation. Aloha Petroleum, a subsidiary of the US-based Sunoco, filed a claim against AIG’s National Union Fire Insurance Company of Pittsburgh earlier this month, arguing it had failed to protect Aloha from the mounting costs of defending climate-related claims by local governments in Hawaii.

According to documents filed in the latest lawsuit, Aloha has already incurred more than $880,000 (£750,000) in defence costs, and expects these to grow significantly as litigation progresses. Its insurance company will not pay out. These are some of the first disputes over insurance coverage for climate crisis litigation to be heard in the courts. Both insurance companies say climate litigation is covered by exclusions for “pollution” in their clients’ general liability policies. If they succeed, the fossil fuel firms could be on the hook for millions of dollars in legal fees, in addition to any future damages awarded in court.