Battery energy storage insurance protects lithium-ion battery energy storage systems (BESS) manufacturers and on-site commercial battery systems.
Battery manufacturers need general liability and products liability, property, environmental, ocean and inland marine, umbrella, cyber liability, professional liability and other important business insurance.
Your business should be protected against claims of bodily injury and property damage, fire and other perils, mechanical breakdown, failure to perform, lost income and more. Perils covered by energy storage insurance may include fire, wind, hurricane, tornado, flood and other climate related risks.
Battery energy storage insurance is for manufacturers, systems integrators, contractors, installers and system owners.
Property and general liability coverage can protect any size project (even 100 megawatts in size). Smaller projects may also be eligible for underwriting, depending on their participation in a portfolio, their configuration and scope. Battery energy storage coverage helps project owners protect their physical assets from fire, equipment breakdown, flood, wind, hail and other perils.
Battery energy storage insurance applications will vary based on your business model. For instance, a battery manufacturer may seek commercial general liability and products liability, whereas an energy storage project developer may seek performance insurance or an extended warranty. As such, underwriting considers business and system information to determine premiums will vary. Information for underwriting may include:
Underwriting insurance for battery manufacturers requires a holistic approach that considers the risks to the company across the entire value chain.
This means working with an insurance broker who understands not only the risks associated with the batteries themselves, such as risk of thermal runaway or a costly recall, but also how key employees, executives and the Board of Directors may be exposed to a potential lawsuit if not properly covered.
Battery energy storage insurance may be purchased to guarantee performance of battery installations for large energy storage projects… Such insurance may include performance insurance, an extended warranty or offtaker insurance and solves the “performance gap” problem, thereby reducing risk for owners, contractors and lenders.
Energy storage performance insurance is underwritten by engineers experienced in energy efficiency risk and backed by A+ rated insurance carriers by A.M Best. Underwriters examine technical documentation, as described above, during the underwriting process.
Project owners benefit from having an insurance policy backed by A+ rated insurance carriers. Equity investors and lenders benefit from having insurance in place because it reduces default risk and increases creditworthiness. Working with the right insurance broker may also reduce your cost of capital as a developer.
If you have questions about securing battery energy storage insurance for your business, you should schedule an appointment with me today.