Due to the expansion of hydraulic fracturing technologies, the United States is on the verge of surpassing Russia as the world's leading producer of oil and gas. As hydraulic fracturing—commonly known as fracking—has risen into the national spotlight, its media footprint has expanded exponentially. A quick scan of today's headlines will show fracking associated with everything from air pollution to earthquakes. But if you judge fracking simply by what the media reports—as most people do—you'll have a skewed perception of the industry.

This hype storm has scared away many companies, including insurers who perceive fracking will result in a high frequency of future losses. However, given the magnitude of resources and opportunities that fracking unlocks, insurers would be wise to approach fracking and the oil and gas drilling industry judiciously and strategically. By following this model, insurers can tap into this major growth engine.

The first step for insurers is to break through the wall of misinformation surrounding fracking. In the case of several of the hot topics around this practice, the conventional wisdom only has half the facts. For example:

• Considerable media attention has been paid to purported groundwater pollution, where fracking fluids or wastewater leaks into aquifers. When done correctly, hydraulic fracturing occurs thousands of feet below aquifers; by properly casing wells and extracting wastewater, groundwater supplies can be completely protected.
• Public concern has also been building around the chemicals used in the fracking process. More than 99.5 percent of what goes into fracking wells is sand and water. Leading oil and gas drilling companies are required to disclose pollutants on the FracFocus national chemical registry, enabling the public to learn more about the chemicals in use on sites near their communities.
• Many assume the industry is poorly monitored and regulated. Instead, the opposite is true—leading states involved in oil and gas drilling, including Pennsylvania, Ohio, North Dakota and Texas have all instituted stringent regulations to ensure that drilling is safe for the general public. Along with the state regulations, associations such as the American Petroleum Institute (API) have created standards and guidelines that promote best practice implementation.

One of the most overlooked facts about fracking is that the process has been used in commercial applications since 1949. Over more than six decades, the U.S. has led the way in developing technology to stabilize and streamline the fracking process.