Risk rewired | beazley

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Risk rewired

Risk rewired

Turning risk into momentum

Insurance is becoming a core enabler of the energy transition. It does more than absorb losses. It helps turn uncertainty into viable, investable projects.

The industry brings decades of experience in modelling emerging and climate-driven risks. This allows insurers to guide decisions on project design, financing and delivery as the market evolves and volatility intensifies.

Insurance extends beyond a financial backstop, shaping energy transition decisions through risk insight, alongside shaping which energy projects proceed, on what terms and pace. However, this raises the question of whether it can scale fast enough to meet demand.

The shift is clear. The energy transition is forcing insurance to move from reactive protection to a more active role in enabling growth. But it requires more sophisticated approaches to uncertainty that address financing, risk sharing, alternative risk transfer solutions and all-round resilience.

Insurance is shaping access to capital

Projects need insurance to secure funding, especially with newer, under-tested technologies, geopolitical disruption and intensifying climate conditions. Where risks are unclear, terms tighten, premiums rise and projects can stall.

When insurers develop specialist solutions, they help convert uncertainty into progress. For example, cover for performance, revenue and political risk can expedite development and turn uncertainty into investible opportunities.

The energy transition is forcing the insurance industry to evolve from a reactive, siloed form of protection into an enabler of growth.

Insurance is driving better resilience

Insurance influences how assets are built and operated. Requirements around design, maintenance and risk controls help improve project quality from the outset. This moves insurance beyond claims. It becomes part of how stronger, more durable infrastructure is built from the outset.
“Insurance has helped improve battery storage practices and solar panel resilience by requiring better risk management, based on loss insight as a condition of coverage. That is what genuine risk partnership looks like.”

Ben Sheppard
Renewable Energy Underwriter, Beazley

Insurer data and insight are a core advantage

Insurers stand apart through experience across almost all risks. They have decades of historical loss data around cyclones, hurricanes, and one-in-a-hundred-year events to apply to new technologies, testing how assets might perform under stress. This game-changing capability helps clients move beyond hindsight and proactively map future risk.

Risk management supports performance

Further risk management strategies underpinning resilience in the energy transition include:

Understanding new risks through modelling and stress testing to uncover and fix vulnerabilities before projects begin

Improving design and operations through clear technical standards, mitigating design flaws and operational errors that trigger catastrophic failures

Guiding investment decisions using risk-based pricing, shifting capital away from high risk technology toward robust, bankable solutions

Reducing downtime and losses following major incidents by deploying engineering expertise, source critical components, and perform root cause analysis

Adapting to regulatory change with ongoing insight into market and regulatory shifts, helping developers adapt early and build through uncertainty
Products are evolving with the market

Traditional insurance models are not enough for the next phase of the transition. New products and structures are emerging to reflect changing risks.

Developers that prioritise and factor resilience into early decisions tend to secure better terms and more stable coverage over time.

Asset location exposures, product insights and extensive, nuanced data intelligence all influence better preparation and subsequent insurability.

“We have brokers and clients come to us and say - 'we're building in this location, what do you recommend?

"We can provide them with insight into location, risk and design, helping to reduce exposure, increase asset resilience and secure lower premiums."

Geoffrey Lehv
SVP, Head of North American Accounts, kWh Analytics (A Beazley company)

Carbon markets are expanding

Insurance is becoming an enabling layer in scaling carbon markets, by improving confidence in credit quality and verification. This supports the liquidity and tradability of carbon credits, helping to strengthen market trust and integrity for both project developers and corporate buyers.

Alternative capital is becoming essential

The scale of investment required goes beyond traditional insurance capacity. Net zero cost estimates by 2050 range from US$100 trillion to US$300 trillion⁴¹. Alternative risk transfer solutions are key to mobilising that capital and managing the risks associated with it.

Tools such as catastrophe bonds, insurance-linked securities and parametric instruments are helping to extend capacity to provide the breadth of protection that today’s larger, more complex projects require.

“Cat bonds, and other ILS and parametric structures can supplement more traditional models where project scale outstrips market capacity. The reinsurance market has a fantastic opportunity to be more creative about how we deploy capital alongside conventional risk transfer.”

Richard Gray
Bermuda General Manager & Head of Third Party Capital, Beazley
Partnership will define progress

Public-private collaboration is becoming central to transition efforts:

Governments are looking to use incentives and guarantees to make marginal projects viable

Multilateral banks, export credit agencies and green funds are partnering with insurers to expand insurability across markets and technologies

Specialist insurers are providing more site-specific risk insight and resilience advice

Brokers are playing a strategic, connective role in translating risk into sharper underwriting, more tailored solutions, and smoother project delivery⁴²

“New risks require policies bridging property, energy and environmental coverage, with closer cross-team collaboration. Siloed thinking produces coverage gaps, and coverage gaps cost clients.”

Lindsay Shipper
Head of North American Commercial Property, Beazley

The resilience value loop
Adapting faster and better delivers success

The economic prospect is significant, but it depends on the right pace, products and partnerships alongside the data capabilities and cross-disciplinary expertise.

The energy transition is not waiting, and insurance is helping to make it possible.

Insurance is shaping access to capital

Insurance is shaping access to capital

Projects need insurance to secure funding, especially with newer, under-tested technologies, geopolitical disruption and intensifying climate conditions. Where risks are unclear, terms tighten, premiums rise and projects can stall.

When insurers develop specialist solutions, they help convert uncertainty into progress. For example, cover for performance, revenue and political risk can expedite development and turn uncertainty into investible opportunities.

The energy transition is forcing the insurance industry to evolve from a reactive, siloed form of protection into an enabler of growth.

Insurance is driving better resilience

Insurance influences how assets are built and operated. Requirements around design, maintenance and risk controls help improve project quality from the outset. This moves insurance beyond claims. It becomes part of how stronger, more durable infrastructure is built from the outset.
“Insurance has helped improve battery storage practices and solar panel resilience by requiring better risk management, based on loss insight as a condition of coverage. That is what genuine risk partnership looks like.”

Ben Sheppard
Renewable Energy Underwriter, Beazley

Insurer data and insight are a core advantage

Insurers stand apart through experience across almost all risks. They have decades of historical loss data around cyclones, hurricanes, and one-in-a-hundred-year events to apply to new technologies, testing how assets might perform under stress. This game-changing capability helps clients move beyond hindsight and proactively map future risk.

Risk management supports performance

Risk management supports performance

Further risk management strategies underpinning resilience in the energy transition include:

Understanding new risks through modelling and stress testing to uncover and fix vulnerabilities before projects begin

Improving design and operations through clear technical standards, mitigating design flaws and operational errors that trigger catastrophic failures

Guiding investment decisions using risk-based pricing, shifting capital away from high risk technology toward robust, bankable solutions

Reducing downtime and losses following major incidents by deploying engineering expertise, source critical components, and perform root cause analysis

Adapting to regulatory change with ongoing insight into market and regulatory shifts, helping developers adapt early and build through uncertainty
Products are evolving with the market

Traditional insurance models are not enough for the next phase of the transition. New products and structures are emerging to reflect changing risks.

Developers that prioritise and factor resilience into early decisions tend to secure better terms and more stable coverage over time.

Asset location exposures, product insights and extensive, nuanced data intelligence all influence better preparation and subsequent insurability.

“We have brokers and clients come to us and say - 'we're building in this location, what do you recommend?

"We can provide them with insight into location, risk and design, helping to reduce exposure, increase asset resilience and secure lower premiums."

Geoffrey Lehv
SVP, Head of North American Accounts, kWh Analytics (A Beazley company)

Carbon markets are expanding

Carbon markets are expanding

Insurance is becoming an enabling layer in scaling carbon markets, by improving confidence in credit quality and verification. This supports the liquidity and tradability of carbon credits, helping to strengthen market trust and integrity for both project developers and corporate buyers.

Alternative capital is becoming essential

The scale of investment required goes beyond traditional insurance capacity. Net zero cost estimates by 2050 range from US$100 trillion to US$300 trillion⁴¹. Alternative risk transfer solutions are key to mobilising that capital and managing the risks associated with it.

Tools such as catastrophe bonds, insurance-linked securities and parametric instruments are helping to extend capacity to provide the breadth of protection that today’s larger, more complex projects require.

“Cat bonds, and other ILS and parametric structures can supplement more traditional models where project scale outstrips market capacity. The reinsurance market has a fantastic opportunity to be more creative about how we deploy capital alongside conventional risk transfer.”

Richard Gray
Bermuda General Manager & Head of Third Party Capital, Beazley
Partnership will define progress

Public-private collaboration is becoming central to transition efforts:

Governments are looking to use incentives and guarantees to make marginal projects viable

Multilateral banks, export credit agencies and green funds are partnering with insurers to expand insurability across markets and technologies

Specialist insurers are providing more site-specific risk insight and resilience advice

Brokers are playing a strategic, connective role in translating risk into sharper underwriting, more tailored solutions, and smoother project delivery⁴²

“New risks require policies bridging property, energy and environmental coverage, with closer cross-team collaboration. Siloed thinking produces coverage gaps, and coverage gaps cost clients.”

Lindsay Shipper
Head of North American Commercial Property, Beazley

The resilience value loop

Case study: The role of insurance in the carbon markets

Carbon markets are evolving quickly. New standards, tighter regulation, rising demand are all reshaping how carbon credits are created, traded and used.

Explore the case study

Spotlight snapshots

Insurance is an enabler of the energy transition

Helping shape which projects move forward by unlocking capital, providing risk insight and improving resilience - not just acting as a financial backstop.
The insurance industry must evolve quickly

Shifting from reactive, siloed protection to proactive, data-driven risk products and partnership that can keep pace with new technologies and rising demand.
Collaboration and innovation are essential

By building the right partnerships, data capabilities, products and cross-disciplinary expertise together the full potential of the energy transition can be unlocked.