Rapid growth amid shifting priorities: 2026 Renewable energy insurance market outlook

Rapid growth amid shifting priorities: 2026 Renewable energy insurance market, outlook - Oliver Litterick, Head of Renewables 

It’s already clear that 2025 has brought major shifts to the renewable energy space, and its insurance market now stands out as a sophisticated ecosystem that balances resilience planning, risk transfer and capital allocation. 

This fundamental shift is taking place because of changing client demands and expectations. It also highlights the natural course of a maturing market, where new technology and ageing assets demand a wider range of insurance solutions and more flexibility from insurers than ever before.

2026 will continue to bring significant changes to our segment of the insurance market, driven by this year’s policy and geopolitical changes, in conjunction with the natural evolution and growing maturity of renewables, which remain a core facet of the wider global green transition.

The time has come to don my ceremonial Santa hat and share my market outlook for the New Year!

Emerging markets will play a larger role

Political uncertainty and dipping investor confidence in some of the more mature markets will cause insurers to pay closer attention to other regions. This comes at a time when many emerging markets' growing middle class is driving an increased demand for energy, which in turn is increasingly bringing cost-effective renewables and BESS into play. With this growth in demand comes a significant opportunity for renewables insurers.

The International Energy Agency’s latest World Energy Outlook 2025 report found that by 2035, “80% of energy consumption growth is projected to occur in regions with high-quality solar irradiation”. Most of it will take place in developing economies in Asia and the Middle East, which explains the rapid deployment of solar technology in these regions. 

General concerns around the sustainability and longevity of the insurance market will continue into the New Year, as the soft market cycle continues.

Simultaneously, clients’ needs are changing as technology evolves – think larger turbines, more complex solar panels, higher-density BESS storage and more hybridisation - markets mature and investors become more sophisticated.

This is particularly the case for major buyers of renewable energy insurance, who will continue to place a lot of importance on the predictability and sustainability of their insurance terms. Flexibility is also a must, as policies have to be able to adapt to increasingly common hybrid projects, such as solar and BESS, or new territory, such as large-scale wind power repowering projects.

The renewable energy insurance market has reached a level of maturity and complexity that is no longer about simply covering property damage. 

The flip side to this is that certain insurance partners will no longer be qualified to provide cover. Many will be faced with difficult decisions on whether they can realistically provide the specialist, reliable, and sustainable service that their customers require. Insurers who can provide a broader and more sophisticated suite of products beyond the traditional renewable energy ones will be the long-term winners.

At TMGX, we have been evolving and growing with the industry for over 25 years, so naturally, this is not the first time we have had to adapt to market changes. Staying mono-lined in terms of products doesn’t help with insurance market sustainability, which is exactly what we are avoiding by drawing on the strength of Tokio Marine Group to diversify our product lines both within ‘traditional’ renewable energy and outside in the wider realm of the green transition. 

Nowhere to go but up

My apologies for the doom and gloom so far – particularly ahead of the festive season! However, the industry will indeed have many reasons to look forward to 2026. For starters, this past year renewables overtook coal as the world’s biggest source of electricity, and this upward trend in the market is only going to continue, with solar in particular expected to dominate the market in 2026.  Despite the political and policy changes of the last year, and the uncertainty as to how they will develop over the next 12 months, we should fully expect renewable energy to remain a rapidly growing market.

One of my sources for this optimism is the International Energy Agency’s latest World Energy Outlook report. This highlights that renewable energy is going to continue growing faster than any other major energy source, triggered by the huge number of data centres being built and connected to the grid, as well as increased demand in new markets. I did say there was a lot to look forward to!

So, these are my two (or four?) cents on what might happen in the insurance space in the next twelve months. Of course, I would never put my personal reputation on the line by trying to predict exactly what will happen next year. For that, I will gladly hand you over to my North American colleagues, Michael and Rosa, to discuss our core market and the backbone of our global offering. You can read their five predictions for the US market here.

As the New Year rapidly approaches, we wish you a wonderful festive season from the entire team at TMGX. We look forward to working together again in 2026 and beyond!

Olly

Oliver Litterick

Head of Renewables, Tokio Marine GX