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Navigating project finance insurance

Observations from Marsh’s Structured Finance Practice, drawn from our experience supporting more than 3,000 financed projects as lenders insurance advisors.

The structured finance market is evolving, with insurance considerations playing an increasingly important role in shaping the success of financed projects.

In this short video series, Marsh Risk’s Structured Finance Practice shares key observations from its experience supporting more than 3,000 financed projects as Lenders Insurance Advisor.

A key due-diligence issue is whether the project’s insurance arrangements are truly “bankable” and provide sufficient protection for lenders’ requirements. Where full reinstatement or catastrophe capacity is not available, the gap should be identified early so the parties can agree a practical solution before it affects financing.

Early alignment on expectations enables timely insurance structure design and helps address emerging issues, such as cyber insurance. This can support financial close without unexpected issues or delays.

Before drawdown, the borrower must show that its insurance programme complies with the loan’s minimum requirements. Early coordination between brokers, lawyers, insurers, and lenders is essential to avoid delays caused by wording, endorsement, or approval issues at financial close.

Insurance compliance must be maintained for the full term of the loan, even as market conditions and available cover change over time. Proactive monitoring is essential to avoid gaps in cover, compliance breaches, or lender exposure if certain risks become harder to insure.

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