As the world’s renewable energy capacity soars a new report has found insurance has shifted from a transactional requirement to a strategic enabler of bankability, lender confidence and capital mobilisation in the face of rising risks.

Broker Willis has published its Renewable Energy Market Review which found the renewable energy sector is entering a new phase of accelerated growth, shaped by rapid technological innovation, intensifying global competition and increasing geopolitical pressure on energy security.

It added while opportunities are expanding, so too are the complexities behind successful projects. For the insurance market, this fosters a technically demanding underwriting environment,

Against a backdrop of strong sector performance, many insurers are looking to diversify their portfolio by broadening their renewable energy book.

Breakthrough technologies such as green hydrogen, next-generation geothermal, and space-based solar are changing the narrative on what is possible. Success in all areas of renewable energy will increasingly depend on execution: managing complexity, anticipating systemic risks, and aligning engineering, finance and insurance strategies.

Among the key trends to watch:

• Abundant capacity and strong competition are driving a sustained softening phase for the renewable energy market, but well-performing, data-rich risks are benefiting the most.
• For 2026, pricing trends indicate reductions between 20-30% for Tier 1 risks (well-engineered, clean, large premium income accounts) and reductions of up to 10-15% for Tier 2 (clean but lower premium income). For loss-affected programmes, renewal will depend upon the quantum of the loss.
• Overall, combined ratios were maintained, with a sub-90% average.
• Further softening is expected, increasing quarter by quarter.
• A majority of insurer portfolios have a ~50% US weighting, with many looking to diversify their account base internationally.
• The urgency and strategic value of energy security through diversified and renewable fuel sources is becoming increasingly important for companies and their risk profiles.
• Geopolitical volatility and growing electrification are compressing timelines for renewable deployment, placing a premium on scale, speed and delivery certainty. These forces are deepening reliance on Chinese suppliers, who dominate original equipment manufacturing, particularly in solar and battery technologies.
• In emerging technologies, the role of insurance is evolving from a transactional requirement to a strategic enabler. Early integration of risk engineering, clear allocation of liabilities, and credible performance data will be critical to unlocking investment and scaling deployment.

Rob Hale, global power and renewable energy leader at Willis Natural Resources, said: “Competitive advantage is shifting towards renewable energy projects that can demonstrate strong engineering standards, robust maintenance practices and credible, data-driven risk insights. Risk is shifting from isolated component failures to systemic dependency risks, with a clear need for companies to map and manage recovery timelines, contingency planning, as well as the alignment between procurement, contracts and insurance structures. The next phase of underwriting will be defined less by price alone and more by the quality of information, analytics and long-term risk management strategies.”

Asia continues to set the pace of the global energy transition, accounting for 74.2% of global new renewable capacity additions in 2025 and increasing installed renewable capacity by 513.3 GW to 2,891 GW, or 56.1% of global renewable capacity.

However, the region’s rapid expansion across solar, wind, hydropower, battery energy storage systems (BESS), hybrid installations and floating solar is also increasing risk complexity.

Sam Liu, Head of Renewable Energy, in Asia, said: “Expansion across solar, onshore and offshore wind, hydropower, rapidly scaling of BESS, hybrid installations and growing floating solar deployments has reinforced Asia’s role in global decarbonisation. As a result, the region’s renewable energy market is scaling at extraordinary pace, but growth alone will not determine which projects succeed.

“As supply chains become more exposed to policy shifts, delivery volatility and climate-related disruption, sponsors and lenders need to treat insurance as part of the project strategy from the outset. The projects that achieve the strongest outcomes in 2026 will be those that can demonstrate transparent data, robust technical design, credible delay assumptions and clear alignment between procurement, contracts and risk transfer.”