2026 Energy and Infrastructure Insurance Market Outlook

Property insurance market trends

Despite significant CAT activity in 2024, many insurance carriers maintained profitability, which contributed to a more stabilized market environment in 2025. As we entered 2026, the first quarter marked a notable and somewhat rapid shift in the property market — from prolonged hard market conditions to an increasingly softening environment. This transition has continued into Q2, with further softening across key lines.

How underwriting is becoming more data-driven

As market conditions have eased, many insureds are benefiting from improved pricing, more favorable sublimits, and reduced deductibles. Catastrophe exposure, however, remains a critical concern — particularly with respect to severe convective storm (SCS) and wildfire risk. While the broader market is softening, underwriting and risk profiling has become more data-driven and increasingly sophisticated as we see technology mature. Carriers are leveraging more enhanced modeling capabilities, portfolio analytics, and third-party engineering insights to refine risk selection and more precisely differentiate between high- and low-performing assets. This has reinforced a widening gap between well-positioned risks and those with challenging exposure profiles.

The conversation around resiliency remains critical, especially with assets located in high-hazard CAT areas. Portfolios that can clearly evidence strong resiliency practices, robust engineering, and proactive operations and maintenance (O&M) programs are viewed more favorably in the marketplace. This differentiation not only supports more competitive pricing but can also drive improved terms and broader coverage offerings.

New insurer capacity is entering the renewable energy market

At the same time, the competitive landscape continues to evolve. Carriers are actively seeking to deploy capacity, with a strong focus on writing new business and retention of existing portfolios. As underwriting appetites expand, insurers are increasingly willing to revisit submissions that may have been declined in prior years, reflecting a shift in risk tolerance and strategic growth objectives.

We are also seeing continued entrance of new carriers and MGA’s into the power and renewables space, many of whom are looking to establish themselves as either lead markets or meaningful participants within program structures. In parallel, technological advancements are reshaping the quoting process, with several carriers introducing digital platforms designed to support solar, wind, and battery energy storage system (BESS) risks. These platforms are enabling accelerated underwriting for less complex risks, with turnaround times in many cases within 24 hours.

The overall direction of the market remains favorable. Strategic positioning, data transparency, and proactive engagement with underwriters remain critical to optimizing outcomes in an increasingly competitive but still nuanced landscape.

The renewable energy claims environment continues to mature as the industry scales. While overall loss frequency remains manageable, insurers are experiencing increased severity from equipment failures, natural catastrophe events, supply chain disruptions, and business interruption losses. As a result, underwriters remain focused on asset quality, operational controls, and catastrophe exposure management.

Renewable energy claims trends

1. Equipment Failure Remains the Largest Driver of Losses

• Solar inverter failures continue to generate significant property damage and business interruption claims
• Battery Energy Storage Systems (BESS) remain a major area of concern due to thermal runaway events and fire losses
• Wind turbine gearbox, blade, and generator failures continue to produce high-severity claims, particularly on aging fleets

2. Natural Catastrophe Losses Increasing

• Severe convective storms, hail, wildfire, flooding, and hurricane activity continue to impact renewable assets
• Solar projects located in hail-prone regions have generated some of the industry’s largest losses
• Carriers are increasing scrutiny of catastrophe modeling, site selection, and mitigation measures

3. Business Interruption Claims Growing in Importance

• Extended equipment replacement times continue to increase loss severity
• Long lead times for transformers, inverters, switchgear, and turbine components can significantly extend restoration periods
• Underwriters are paying closer attention to indemnity periods and BI limit adequacy

4. Construction Claims Remain Elevated

• Builder’s Risk claims continue to stem from weather events, defective workmanship, transit damage, and testing & commissioning activities
• Delays in project completion are increasing soft-cost and delay-in-startup exposures
• Quality control and contractor management remain critical underwriting considerations

5. Cyber Risk Emerging as a Material Exposure

• Renewable operators are increasingly dependent on remote monitoring, SCADA systems, and digital asset management
• Insurers are monitoring cyber events that could lead to operational disruption, physical damage, or grid instability
• Cyber underwriting standards continue to tighten across the sector

How insurers are responding

What underwriters are evaluating

• Asset quality and OEM selection
• Preventive maintenance programs
• Catastrophe resilience and engineering controls
• Fire suppression and emergency response planning
• Supply chain resilience
• Cybersecurity controls

Coverage considerations

• Continued pressure on catastrophe deductibles
• Increased scrutiny of Business Interruption values and indemnity periods
• Greater underwriting review of Battery Energy Storage projects
• More detailed engineering information required during renewal and new placements

Renewable energy insurance market outlook

Despite elevated loss activity, insurer appetite for renewable energy remains strong. Capacity remains available for well-managed risks; however, carriers are increasingly differentiating between best-in-class operators and average performers. Organizations that demonstrate strong risk management, robust maintenance programs, and catastrophe resilience are achieving the most favorable renewal outcomes.

The renewable energy insurance market remains supportive but claims experience is driving greater underwriting discipline. Risk quality, operational excellence, and loss prevention are becoming the primary differentiators in achieving competitive terms and conditions.

Catastrophe modeling and risk analytics

The Brown & Brown Risk Solutions property modeling team provides catastrophe risk analytics and exposure intelligence solutions focused on renewable energy portfolios, with particular emphasis on solar, wind, and battery storage assets. We support pre-underwriting, risk engineering, and exposure management functions by transforming complex catastrophe model outputs into structured, decision-ready insights that enhance risk selection, capital allocation, and portfolio optimization.

Advances in renewable energy catastrophe models for renewable energy

A key area of evolution within the energy data and analytics landscape is the continued maturation of catastrophe modeling capabilities for renewable energy assets. While catastrophe modeling vendors have historically demonstrated strong sophistication in traditional property catastrophe modeling, earlier renewable energy applications often exhibited notable limitations. In recent years, the market has seen significant progress as property catastrophe modeling vendors have accelerated investments in renewable energy-specific analytics. Major advancements include the development of higher-resolution severe convective storm and hail models, improved hazard footprint characterization, enhanced vulnerability methodologies for solar assets, and the introduction of renewable energy-specific construction and occupancy classifications.

The industry has also seen increased emphasis on engineering-based resilience testing and more realistic damage-simulation approaches designed to better represent actual hail-impact conditions for utility-scale solar facilities. These enhancements enable more refined assessments of hail damage probability, loss severity, and mitigation effectiveness, including operational strategies such as panel stow configurations during severe weather events.

This evolution reflects a broader industry shift toward more asset-specific and engineering-informed catastrophe analytics for renewable energy portfolios. The integration of higher-resolution hazard datasets, improved vulnerability curves, and more granular exposure classifications is helping bridge the historical gap between conventional property catastrophe modeling and the unique risk characteristics associated with renewable energy infrastructure. As renewable energy portfolios continue to expand in both scale and geographic concentration, the demand for more sophisticated and transparent catastrophe analytics is expected to continue increasing across underwriting and portfolio management functions.

How Brown & Brown supports catastrophe risk analysis

Within this evolving landscape, our capabilities include the post-processing and interpretation of vendor catastrophe modeling outputs to deliver comprehensive reporting across exposure distributions, modeled losses, probable maximum loss (PML) metrics, hazard drivers, portfolio accumulations, and underwriting-focused risk summaries. This enables complex model outputs to be translated into consistent, transparent, and actionable analytics that can be readily used by placement brokers and senior management teams in decision-making processes.

Real-time catastrophe monitoring and portfolio insights

We also apply advanced spatial disaggregation techniques for solar farm exposures by distributing total insured values (TIVs) across grid points within the actual facility footprint, rather than aggregating all values to a single geographic coordinate. This methodology materially improves the representation of hazard interaction at the asset level, particularly for localized perils such as hail, tornado, flood, and wildfire. By increasing spatial resolution, this approach enhances loss estimation accuracy and enables more realistic modeling of partial-site damage, which is a critical consideration for large-scale renewable energy installations.

In addition, we develop exposure mapping and visualization frameworks that include static and interactive dynamic mapping tools for accumulation analysis and exposure quantification. These tools support clearer communication of portfolio concentration risk and enable intuitive exploration of exposure patterns at both site and portfolio levels. Complementing this, we provide hazard intelligence reporting leveraging platforms from market-leading carrier partners, incorporating site-specific hazard assessments, forward-looking climate change scenarios, and broader environmental and resilience-focused risk insights.

We also support real-time catastrophe response and event monitoring, enabling rapid identification of impacted renewable energy assets during active catastrophe events and supporting near real-time loss estimation and portfolio impact assessment. Overall, the renewable energy catastrophe modeling ecosystem continues to evolve rapidly, with the market increasingly moving toward higher-resolution, engineering-informed, and renewable-specific catastrophe analytics. At the same time, the industry remains characterized by both engineering-led single-site assessment providers and portfolio-level catastrophe analytics platforms, with our approach bridging these perspectives through the integration of detailed site-level analytics and scalable portfolio-wide risk assessment frameworks.

Cyber insurance market outlook

The cyber market has transitioned from a period of pricing volatility and capacity constraints three years ago to a more stable phase. The market is competitive, and seemingly sustainable with capacity rebuilt and modest softening in premiums over the last three-year period. Renewals continue to be largely in the 0% to -10% range.

Cyber insurance underwriting trends

As underwriting is becoming more sophisticated, standards have become less exacting as companies become more secure and competition drives towards lower information requirements. Insurers are responding by tightening underwriting standards, integrating cybersecurity data into pricing, and working with security firms to provide proactive risk management services.

Claims dynamics are shifting, with frequency stabilizing in some segments while severity is rising in many areas due to higher regulatory fines, increased business interruption claims, and extortion tactics like double and triple ransomware have become common. As a result, cyber insurance is increasingly viewed not just as a financial product, but as part of a broader cyber risk management ecosystem that blends insurance, prevention, and incident response

How AI is changing cyber risk

AI is accelerating the evolution of cyber risk, allowing threat actors to automate elements of the attack process and execute more sophisticated attacks at greater speed. Threat actors are getting better at using social engineering as the basis of phishing aided by AI. Companies are not at a point yet where AI defense operates automatically so humans still make big decisions on taking systems down or leaving them up. The time to understand the risk and make critical decisions is becoming shorter every day.

Coverage is broadening and narrowing depending on the exposure and the controls in place at any individual insured. Several markets, including those supporting Brown & Brown’s proprietary cyber policy CyberSelectTM are providing specific extensions of coverage designed for the energy industry.

Coverage enhancements for the energy sector

• Affirmative coverage for NERC and FERC fines and penalties even in the absence of a systems breach.
• Cover for operational cost to address the exposures of energy companies.
• Cover costs to replace power in the ‘spot market’ if required after a cyber event.
• Cover for liability due to ‘failure to provide’ power to purchasers.
• Cover for relighting costs

The market is also providing solutions for aligning property casualty and other products to fill gaps especially where exclusions are becoming more common in traditional insurance. Those include:

• Cyber caused property damage added to cyber coverage or in a standalone policy
• Cyber caused bodily injury and property damage liability added to cyber coverage or in a standalone policy
• Cybercrime social engineering coverage added to a program on an excess basis

War exclusions remain an important consideration

War exclusions are back in focus. These issues have been debated at length over the past several years but are now moving from theoretical discussion to potential claims relevance. Some markets providing cyber to the energy sector have moved to requiring war exclusions, while others are becoming open to removing them. Where there are exclusions, they fall into three broad categories. Some may impact coverage because of the current conflicts so close attention is essential.

Insurance considerations for grid-connected and behind-the-meter data centers

The rapid expansion of data center infrastructure — driven by AI adoption and increasing digital demand — is fundamentally reshaping the insurance landscape. One of the most important emerging considerations is how facilities are powered. The distinction between traditional grid-connected data centers and behind-the-meter (BTM) power models now plays a critical role in determining risk profile, insurability, and cost of risk.

Grid-connected data centers

Grid-connected facilities remain the most established and widely understood model from an insurance perspective. In this structure, power generation and distribution risks are borne by the utility provider, while the data center operator is primarily responsible for facility operations and uptime. This clear separation of risk aligns well with existing insurance products and underwriting practices.

As a result, the insurance market for grid-connected data centers is relatively mature. Carriers are generally comfortable deploying capacity across property, business interruption, liability, and cyber lines. Programs tend to be standardized, scalable, and competitively priced, particularly for well-engineered facilities located outside high catastrophe zones.

The primary exposure for grid-connected data centers is dependency on the utility grid, with outages typically resulting in contingent business interruption (CBI) losses. While this risk is material, it is well-modeled and broadly understood by insurers.

Overall, grid-connected assets are viewed as highly insurable and financeable, with insurance rarely acting as a barrier to project execution. Instead, the principal constraint in this model is often access to reliable power from the grid, rather than the availability of insurance capacity.

Behind-the-meter (BTM) data centers

Behind-the-meter data centers represent a growing segment of the market, offering a solution to grid constraints by co-locating or directly integrating on-site power generation. While this approach can accelerate development timelines and improve energy certainty, it introduces significantly greater complexity from an insurance standpoint.

Under a BTM model, the data center operator effectively assumes responsibility not only for IT and facility operations, but also for power generation and energy management. This creates a hybrid risk profile, combining elements of both data center and energy infrastructure exposures.

Key risk considerations include:

• Power generation failure and mechanical breakdown
• Fuel supply interruption
• Battery energy storage system (BESS) fire risk
• Environmental and regulatory liability
• Potential for correlated outages, where both power and IT systems fail simultaneously

This consolidation of risk presents challenges for insurers. Traditional data center underwriters may lack appetite or insight in energy-related exposures, while energy markets are not always structured to address hyperscale digital infrastructure risks. As a result, the insurance market for BTM facilities is less mature and more fragmented.

From a placement perspective, BTM projects often require bespoke program structures, combining multiple insurance markets and layered coverage solutions. Capacity, particularly for property damage and business interruption can be constrained, and pricing tends to be higher with more restrictive terms and retentions.

Insurers also apply greater scrutiny to:

• Redundancy design across both power and IT systems
• Reliability and security of fuel supply
• Fire protection systems, particularly for battery storage
• Operator experience managing integrated energy assets

As data center development continues to accelerate, the intersection of power strategy and insurance will remain a defining issue. Grid-connected facilities continue to represent the benchmark for insurability and stability, while BTM models, though essential in certain markets, require more sophisticated risk structuring and insurance solutions.

What organizations should watch in 2026

Going forward, successful projects will be those that integrate insurance considerations early in the development process, ensuring that power strategies, engineering design, and risk transfer mechanisms are aligned to support long-term scalability, resilience, and financial viability.