Munich Re has unveiled a new insurance coverage for long-term battery performance, allowing battery makers to provide long-term performance guarantees.
Touted to be the first in the world, the insurance plan covers manufacturer performance warranties for a period of 10 years. It allows battery manufacturers to insure their customer warranties.
The new product protects battery manufacturer from financial burden in case repair or replacement costs which falls under customer warranties surpasses a fixed amount.
Commenting on the launch of the new product, Munich Re member of the board Peter Röder said: “The ability to insure battery performance is a key piece of the puzzle in decarbonising our energy sector.
“For the first time, battery manufacturers can insure against the risk of their products not delivering as promised. With this new coverage, Munich Re has again demonstrated its pioneering role in the insurance of climate-friendly technology.”
Helping manufacturers to boost deployment of battery capacities
The new insurance coverage supports manufacturers to boost deployment of battery capacities, and make renewable energy more dependable and widely available.
Alternatively, the coverage can be expanded to protect particular investment projects directly, so that the insurance will pay even though the manufacturer who issued the warranty files for insolvency within the warranty period.
Mainly, the long-term battery performance insurance is aimed at major projects, such as those to ensure grid stability or to cover peak demand periods.
Coming soon – Coverage for Electric Vehicles
During the second phase, the insurance coverage will be launched onto the mobility market, for example to insure performance of batteries in electric vehicles.
Munich Re has signed US battery manufacturer ESS as the first customer for its new insurance product. Now, ESS’ redox flow batteries will be offered with Munich Re’s performance warranty cover.