MNRE Releases New Insurance Product List Covered Under IRDAI

MNRE Released New Insurance Products List Covered Under IRDAI

The Ministry of New and Renewable Energy (MNRE) recently released a list of products that are covered by the IRDAI (Insurance Regulatory and Development Authority of India). The MNRE list covered details of various products that they offered and covered details of risks associated with solar power plants for information to the stakeholders.

The list included seven stakeholders that offer products with coverage.

1. The New India Assurance Co ltd

The New India Solar Energy Insurance Policy has an annual coverage. The policy mentioned, “The coverage offers a new India solar energy Insurance policy. Is sold as a package and protects the seller and buyer and therefore provides a very strong marketing advantage for the Photo Voltaic (PV) module manufacturer.”

It added, “The sales cover ensures the PV modules of specific sales contracts, which can be chosen by the manufacturer. The Buyers Cover allows the buyers of PV modules to claim to the insurer in the event of manufacturer’s insolvency. Each Sales Contract, and therefore each Buyer, has a clearly assigned limit and deductible, increasing the bankability of the project.”

2. Tata AIG General Insurance Company Limited –

This is a weather insurance policy that is based on risk period. The policy covers losses, resulting from deviation of observed weather index.

3. Tata AIG General Insurance Company Limited –

This is a solar module warranty insurance with a premium is paid for one year of production and the IP starts thereafter usually for 25 years of the warranty. It includes two sections. 

Section A: covers the contractual liabilities of manufacturers, arising out of the long-term performance and product warranties provided for PV modules that are sold internationally, either to its local sales offices or directly to its customers. It indemnifies the costs and expenses necessary to fulfill its obligations under the Warranty.

Section B: provides financial protection to the buyers of the PV Modules in case the manufacturer becomes insolvent.

4. HDFC ERGO GIC –

It covers a solar panel warranty insurance policy which is issued on an Annual basis and the coverage is up to the Manufacturer’s Warranty period.

The product is designed to protect the balance sheet of the solar module manufacturers as well as the investment of the buyers or sellers of solar panels by covering the losses to solar modules with regards to their performance & product warranty, which is offered by manufacturers to the buyers and also against insolvency risk of the manufacturer.

Solar Panel Warranty Insurance Section 1 covers:

In an event during the indemnity period, a breach occurs in either product or performance warranty, the Company will indemnify the Insured for its loss directly resulting from such breach.

Solar Panel Warranty Insurance Section 2 covers:

In an event during the indemnity period, a breach occurs in either product or performance warranty, the Company will indemnify the beneficiary for its loss resulting from such breach, but only if the Insured has failed to comply with its contractual obligations under the product or performance warranty in respect of such breach due to the insolvency of the insured.

5. ICICI Lombard General Insurance Company Limited –

The document mentioned the insurance covers photovoltaic panel warranty with a product warranty of 10-12 years and 25-30 year performance warranty.

The coverage in the product would be related to the warranty provider, manufacturer, is insolvent and underperformance in solar modules on the account of performance degradation of the solar panels insured below the performance warranty due to the following perils a) faulty manufacturing b) material defects and c) material aging beyond normal wear & tear and degradation.

6. IFFCO-Tokio General Insurance Co. Ltd. –

The photovoltaic sales policy with a Policy Period One Year. This policy covers the Performance warranty given by the manufacturers. In addition to the Performance warranty, it also covers the product warranty issued by the manufacturers. This policy is extended to cover the Buyer of the Photovoltaic modules provided the manufacturer becomes insolvent. Buyers can also buy the policy over and above the Indemnity limit under Photovoltaic Buyer policy as a top up cover. The loss to the Buyers of the photovoltaic modules is indemnified provided the manufacturer becomes insolvent or top-up cover is opted. The insolvency of the manufacturer/Insured makes it impossible to satisfy obligations to indemnification under Photovoltaic Sales Policy & only permits recovery under the Photovoltaic Buyers policy.

7. Cholamandalam MS GICL –

It offers Chola Solar Plant Protect Policy which has an annual plan. This policy provides coverage for shortfall in deemed energy production due to lack of solar irradiation.

Link for more details – https://cdnbbsr.s3waas.gov.in/s3716e1b8c6cd17b771da77391355749f3/uploads/2024/02/202402261220743031.pdf