The oil and gas industry can face severe, low-frequency risks. Globally, there are few insurers who can insure appropriately against some of these risks. Shell – like other major oil and gas companies – self-insures most of its risk exposure.
Shell’s principal insurance company, Solen Versicherungen AG (Solen), is based in Switzerland where we have qualified insurance specialists to manage our insurance activities. This includes underwriting, risk management, claims handling and balance sheet management. Solen does not outsource any of its critical business functions.
Solen offers a range of insurance products and services to Shell operating companies and joint-venture companies, including those that are not controlled by Shell. Solen’s insurance policies are set with reference to policy terms, conditions and prices that are commercially available from external insurance companies operating in the energy sector.
Solen has a licence to conduct insurance business from the Swiss insurance regulator (the Swiss Financial Market Supervisory Authority, FINMA). FINMA’s regulatory requirements for Solen are the same as for independent insurance companies.
Solen maintains the required level of capitalisation to comply with Swiss regulatory and rating agency requirements. Solen’s capital is maintained at a level that ensures an ‘A’ rating from global credit rating agency AM Best. This is higher than the Swiss solvency requirements and allows Solen to enter into commercial arrangements with third-party insurance suppliers and joint-venture customers.
Solen uses robust methodologies and governance processes to assess, mitigate and manage the risk of its insurance, re-insurance and associated investment functions that provide a commercial benefit to Shell-controlled and some non-Shell-controlled operating companies.