Insurances
Wind farm insurance
WE OFFER A FULL SCOPE OF INSURANCE TO COMPANIES OWNING WIND POWER PLANTS/WIND FARMS
When insuring a wind farm, the specific nature of the same needs to be considered. This means that wind farm insurance differs from insurance products used in other sectors.
The insurance of a wind farm (wind turbines complete with infrastructure, including transformers, auxiliary equipment, cabling, etc.) may be taken out in various options, starting from the most simple one: insurance against fire and other perils (an example of loss: 1) turbine fire as a result a stroke of lightning, 2) wings damage in many turbines as a result of strong wind, 3) nacelle’s rotor breaking off as a result of a hurricane), with the possible extension to include the risk of burglary and theft, robbery or act of vandalism, ending with the broadest scope of insurance – insurance dedicated to wind farms, structured on all risks basis, which encompasses both various external risks, such as e.g. fire, stroke of lightning, strong wind, flood, frost, burglary and theft, devastation and other risks that have not been excluded from the insurance cover, and internal risks, e.g. failures, which consist in damage to equipment as a result of e.g. errors in handling, lack of lubricant, faulty operation or failure on the part of control devices (an example of loss: due to a problem with tilt control system, the turbine reached excessive speed – nacelle and rotor wings became damaged), centrifugal force operation and other events.
Particularly this last insurance scenario allows the policyholder to receive indemnity in the case of many losses that may occur during a wind farm operation.
The insurance may also cover losses resulting from design errors, material defects or faulty workmanship (an example of loss: 1) due to incorrect twist of the turbine, the rotor and wings broke off, 2) gear damage as a result of a design error).
When insuring a wind farm, it is worth making sure that the insurance includes additional limits, e.g. for the payment of the costs of rescue activities, disposal or soil contamination removal (an example of loss: as a result of oil leakage from the sealing system, the soil became contaminated), costs of construction of temporary roads, the cleaning of the loss remains, the protection of the property rescued after the loss (including the costs of the property transport), costs of recovery of data and software used for controlling the power plant.
Bearing in mind the protests that sometimes accompany the construction and operation of a wind farm, it may be worth considering the extension of the scope of insurance cover to include the risk of disturbances.
Additional insurance, which is complementary to that described above, is business interruption insurance (loss of profits insurance). The insurance compensates for the loss of the expected gross profits (as recognised by insurance companies), as a result of a loss covered by the insurance, which caused interruption in electric energy production and, in consequence, the suspension of electric energy sale.
Apart from the above-mentioned property insurance products, an important element of a comprehensive wind power plant coverage is the liability insurance, meaning the business liability insurance (an example of loss: due to electrical short-circuit during turbine operation, an employee suffered numerous burns).
At the stage of a wind farm construction, we would also recommend taking out the construction / erection all risks insurance and the insurance of the particular power plant elements during transport – the so-called cargo insurance. The construction / erection all risks insurance may be taken out by the investor or by the general contractor (only for earth works or electrical works, or both earth works and turbine assembly works).