Renewable Guard Insurance Brokers has announced a new partnership with Hailsure Underwriting Managers to deliver a new parametric hail insurance program to solar project developers. Hailsure has developed solutions that incorporate parametric insurance across a range of different markets.
Parametric insurance is an innovative type of policy where coverage is “triggered” when a measurable event occurs which exceeds a set threshold; in this case, a significant hailstorm. Hail size is measured by the largest independent weather data provider in the country through the use of advanced 3D radar, an onsite hail station and a series of weather algorithms that utilize multiple data sources, including the National Weather Service. The trigger for coverage and payout is determined by the size of the largest hail that falls on the solar project site.
Advantages of parametric coverage for renewable energy project sites include:
- Easy integration into existing project-level coverage
- Flexible terms (variable coverage limits, hail size triggers)
- Fast claims (payment within seven to 10 business days) without the requirement of traditional on-site claims adjustments.
The property insurance marketplace has hardened significantly in 2020 and developers in the renewable energy industry have felt the effects. Carriers providing traditional project-level insurance have seen a significant increase in catastrophic losses due to convective storms and hail damage.
“2019 saw one of the industry’s largest single hail loss ever with damage to a Texas-based solar project in the tens of millions of dollars. The increasing severity and unpredictable nature of convective storms have required many project-level carriers to implement sub-limits for hail, while also increasing hail deductibles. The option to obtain additional hail limits via excess markets has, in essence, become commercially nonviable due to hard market rate increases,” said Michael Cosgrave, Principal at Renewable Guard. “Adding parametric hail gives the existing project-level insurance program an extra and important dimension of coverage by providing developers and their lending partners with peace of mind and protection against the serious financial impact of major hailstorms.”
Richard Alan Duer, Managing Member of Hailsure said, “We’re extremely excited with our partnership with Renewable Guard to offer the brand-new Parametric Hail policy, as it provides the renewable energy industry with a timely solution to address their project’s financial needs. With hail season now upon us, we felt the expertise Renewable Guard brings to the renewable energy market will help developers seamlessly implement this new coverage to projects most impacted by hail.”