XL Group, Munich Re, New Energy Risk Provide Insurance for Fuel Cell Project

September 12, 2014

XL Group’s Complex Accounts unit, Munich Re’s Green Tech Solutions team, and consultants New Energy Risk (NER), have teamed up to deliver a performance insurance policy for a portfolio of fuel cell servers installed across the U.S. The insurance cover provides support for the project financing by insuring the fuel cells’ performance over 15 years, should the manufacturer be unable to meet its warranty obligations. The $99 million bond issued to help finance the portfolio of servers was granted investment grade rating, which resulted in notable financing efficiencies. Arthur J. Gallagher was the broker for the transaction.

XL Group launched this performance insurance cover in 2013 along with specialized consultants New Energy Risk. The fuel cell technology covered in this deal will enable a grid-independent energy supply for several companies.

It is the first time that an insurance coverage, provided by XL Group and Munich Re, has contributed to a financing bond receiving investment grade rating, thereby becoming more attractive to a wider range of investors.

XL Group’s Complex Accounts team serves both national and international companies across different industries that are looking for cover from economic and operational risks which could have an unexpected negative impact that they’re not able or willing to bear alone. These may include risks to specific innovation-related projects, a business’ value chain, or its annual revenue or profitability. At present the teams geographic focus is primarily in Europe; in the United States they work exclusively in partnership with New Energy Risk and policies are provided by XL Group’s Indian Harbor Insurance Co.

Munich Re’s Green Tech Solutions team provides customized coverage to enable business in the area of renewable energy and energy efficiency.

XL Group plc’s insurance companies offer property, casualty, professional and specialty insurance products globally.

New Energy Risk provides data analytics, strategic consulting, and financial risk transfer options to the renewable energy industry, worldwide. New Energy Risk is a privately held firm based in Menlo Park, Calif. and Fairfield, Conn. In the United States, XL Group’s Complex Accounts insurance team works exclusively with New Energy Risk.

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