Advanced Hail Risk Insights for Renewable Assets

This technical report discusses the increasing risk of severe convective storms, particularly large hail, and their impact on the insurance sector, especially concerning renewable energy assets like solar photovoltaic (PV) farms. It outlines the significant financial losses caused by hailstorms, which have become a primary concern for insurers and reinsurers, accounting for a substantial share of global insured catastrophe losses. The report presents a case study focused on South Africa, where the unique topography and weather patterns contribute to high hail risk for solar PV farms. It details mitigation strategies, including real-time weather alerts and hail-resistant technologies, to improve underwriting outcomes. Additionally, the report emphasizes the importance of advanced risk modeling tools, such as Gallagher Re's probabilistic hail model, to support decision-making in the (re)insurance industry. The findings highlight the urgent need for insurers to adapt to the evolving risk landscape as climate change is expected to exacerbate hailstorm frequency and intensity.