Energy Risk Engineering Insights

Let’s discuss serial loss clauses in manuscript insurance policies for wind turbines.

Serial loss clauses in manuscript insurance policies for wind turbines are provisions that address consecutive losses or damages to multiple wind turbines within a specified timeframe. These clauses outline the coverage and conditions associated with such scenarios. Here are some key points to consider when discussing serial loss clauses:

1. Definition of Serial Loss: The policy should clearly define what constitutes a serial loss, such as multiple wind turbines within a wind farm experiencing losses or damages within a specific period.
2. Deductible Structure: Serial loss clauses often involve deductibles, which are the amounts the insured must bear before the insurance coverage kicks in. The policy should outline the deductible structure for each subsequent loss within the specified timeframe.
3. Aggregate Deductible: An aggregate deductible is a common approach where a single deductible applies to the total losses incurred within a specific period. Once the aggregate deductible amount is reached, subsequent losses within that period are covered without an additional deductible.
4. Time Deductible: A time deductible structure sets different deductible amounts for each loss event occurring within a specified timeframe. The deductible may decrease for subsequent losses within that period.
5. Coverage Limitations: Serial loss clauses may include limitations on coverage as the number of losses increases. This can involve reducing the coverage amount for each subsequent loss or imposing a maximum limit on the cumulative losses within a specified timeframe.
6. Waiting Period: A waiting period may be included in the clause, requiring a specific duration to pass between consecutive losses before coverage applies. This helps ensure that only significant or separate loss events are covered.
7. Premium Considerations: The inclusion of serial loss clauses can impact the insurance premium. The policy should specify the premium structure and any adjustments based on the risk associated with serial losses.

It’s essential for wind turbine owners and insurers to carefully review and negotiate the serial loss clauses within manuscript insurance policies. The specific terms, conditions, and limitations will vary based on the policy and the agreed-upon terms between the parties involved. Consulting with insurance professionals experienced in wind turbine insurance can provide further guidance and ensure comprehensive coverage.