NARDAC expands SCS coverage for US renewable energy projects

NARDAC, an energy and infrastructure broker and Managing General Agent (MGA), has launched a new facility to provide additional severe convective storm (SCS) coverage for renewable energy projects in development and operation.

The facility will offer up to $20 million in standalone SCS coverage for US projects, marking the first of several natural catastrophe solutions NARDAC plans to introduce in 2025.

In December 2024, Swiss Re reported that SCS-related losses in the U.S. over the previous 12 months totaled approximately $51 billion. In response to rising claims, underwriters have scaled back capacity for SCS events, leaving insureds with inadequate protection and jeopardising the feasibility of new projects in high-risk areas.

While SCS is often associated with hail risk for solar projects in the southern U.S., covered events also include tornadoes, lightning strikes, and powerful derecho winds. Beyond hail, extreme weather is increasingly affecting renewable energy developments in states with expanding solar capacity, such as Louisiana, Ohio, North Carolina, and Kansas.

NARDAC developed this facility after securing additional SCS coverage for a 2 GW solar portfolio in Texas, where a major hailstorm exhausted the project’s existing insurance limits. The experience underscored the industry’s need for a dedicated standalone SCS facility. With this new offering, NARDAC can now provide coverage indications within 48 hours or less.

“The increasing incident rate of natural catastrophe events, and in particular severe convective storms, is leading to unsustainable losses for traditional insurance carriers. This is forcing many insurers to reduce their cover,” added Jatin Sharma, Managing Partner, NARDAC. “This poses an existential threat to the continued build-out of onshore renewables across a number of US states.”

“By bringing greater natural catastrophe capacity to the renewable energy market, and directly linking this facility with NARDAC‘s specialist broking knowledge and track record, insureds will benefit from critical additional cover that protects operational projects and assets in development.”

“As climatic change continues to impact renewable energy project development and operations, we look forward to leading asset protection with creative new facilities that provide the market with the solutions needed to secure the energy transition.”

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