Downhole Tools Insurance for Canadian Oilfield Operations

Downhole tools are highly specialized assets that can be difficult or costly to recover when they are lost or damaged in a wellbore. Standard property and equipment policies may not adequately address the exposures that arise once these tools are operating below the surface.

SWS works with retail insurance brokers to provide access to a specialized downhole tools insurance program for qualifying Canadian onshore operations.

Coverage Designed for a Specialized Exposure

Downhole tools insurance is intended to address scheduled tools that become lost or damaged while being used in an insured wellbore.

Depending on the approved risk and policy terms, coverage options may include:

• Scheduled downhole tools

• Physical loss or damage in the wellbore

• Broad-form or all-risks coverage

• Replacement-cost valuation

• Agreed-value options

• Coverage while at an insured location or in transit, when included

All tools, values and operations must be reviewed and accepted by the insurer. Recovery requirements, reporting obligations, exclusions and other policy conditions will apply.

Who May Require Downhole Tools Coverage?

The program may be relevant to companies involved in:

• Directional and horizontal drilling

• Measurement and logging services

• Wireline operations

• Well servicing

• Drilling and completion support

• Specialized tool rental

• Other operations using insured tools below the surface

Information Needed for Underwriting

A detailed submission may include:

• Description and schedule of tools

• Replacement or agreed values

• Intended use and operating conditions

• Geographic area of operation

• Tool ownership and rental arrangements

• Loss and recovery history

• Risk-management and retrieval procedures

SWS helps retail brokers review the submission and present the risk to an appropriate insurance market.