Energy and Power Insurance Market Update - 2020 Q2
As the full impact of COVID-19 continues to be felt across the globe, the energy and power industry is analysing the effects on their balance sheets and overall risk landscape.
Over the last quarter the energy and power insurance market has remained turbulent. Insurance capacity remains scarce, particularly in downstream, as the global insurance market continues to harden and insurers look to introduce additional coverage restrictions to manage their exposure to cyber and pandemic risks.
In order to minimise pricing increases and maximise the coverage it is important to work closely with a specialist broker and take a strategic approach to risk mitigation and transfer. Increasingly energy and power companies are looking at retaining an increasing amount of risk or considering alternate ways to transfer it from their balance sheet.
Starting the renewal or placement process remains key, especially in a remote working environment, to ensuring that you are able to take a considered and strategic approach to insurance placement.
In addition to the market update, this quarter we consider ‘Operability’ the new upstream business interruption insurance issued by the insurers behind the long-standing Chrysalis ‘Excess OIL’ policy. The policy has been designed as a production hedge, to for mitigate the unpredictability of production revenue.
This quarter we focus on offshore construction insurance – considering the risk, the insurance market and examining the standard wording used for this specialist line of business WELCAR 2001.
Please download the latest edition of the Marsh JLT Specialty Energy & Power Newsletter for these articles and a detailed analysis of the energy and power insurance market conditions.