Adaptation to Climate Change

Insurance Products that Promote Renewable Energy

Products & Service

With Japan’s Renewable Electric Energy Feed-In-Tariff system starting to operate in July 2012, and a growing number of companies and other entities have been participating in renewable energy projects. For entrants into the renewable energy electricity market, we offer insurance to cover emergencies as well as risk analysis services for the project facilities’ site environments.

●Fire Insurance for Wind Power Companies: Special Clause Covers Costs to Prevent Recurrence of Accidents

Sompo Japan Nipponkoa offers fire insurance for wind power companies with a rider that covers costs for actions to prevent accidents from recurring. For wind power companies, if accidents occur, the losses can tend to be expensive, and similar accidents are likely to recur. Thus, it is important for the management of wind power companies to identify the causes of an accident, and take measures to prevent recurrence. To address these issues, Sompo Risk Management is supporting the stable management of wind power companies by developing this rider, which incorporates our accident recurrence prevention knowhow, to provide insurance and risk management services.

●Property and Casualty Insurance for Offshore Wind Power Companies

For offshore wind power projects, insurance coverage was arranged separately for the construction process and project operations after completion. But from the perspective of preventing gaps in insurance coverage and improving the efficiency of project management, many businesses were asking for unified insurance. In response, Sompo Japan Nipponkoa now offers insurance in the event of the occurrence of damage to offshore wind power facilities due to unforeseen or sudden accidents during facility construction and operations.

●Risk Diagnosis Services for Renewable Energy

Since September 2012, Sompo Risk Management has been offering risk diagnosis services for renewable energy. These services make use of knowledge accumulated through our risk analysis services relating to natural disasters such as earthquakes, flooding, and lightning strikes, as well as the development of risk maps. The services aim for a stable electricity supply from renewable energy, which has a low environmental impact, and involve analysis and diagnosis of site risks for renewable energy facilities such as photovoltaic and wind power electricity generation facilities.

●Risk Diagnosis Services for Wind Power Businesses at the Planning Stage

Sompo Risk Management analyzes and grades various risks during the operation of both land-based and offshore wind power operations when they are at the planning stage. These services are aimed at reducing the potential risks of projects by encouraging the operators to take steps to reduce risks based on assessments, thereby reducing the amount of risk exposure before starting the projects.

●Risk Inspections and Diagnosis Services for Wind Power Facilities in Operation

Sompo Risk Management selects turbines at power generation sites that have a high probability of major accidents or breakdowns, then conducts third-party inspections and diagnosis of business risk. These are considered to be detailed inspections of critical risks.

●Development of Risk Assessment Model for Wind Power Facilities

Sompo Risk Managemen has developed a risk assessment model for wind power facilities. Identifying the risk of electrical or mechanical breakdowns and accidents due to natural disasters and other factors using the risk assessment model enables us to quantitatively ascertain the risk of wind power projects and calculate the appropriate insurance premiums. They will further develop their services that use the risk assessment model and contribute to the spread of wind power.

●Financial Impact Analysis Service for Wind Power Projects

Sompo Risk Management offers a service for wind power projects that evaluates the probability of losses occurring due to accidents from natural disasters and typical breakdowns, as well as losses due to a halt of operations when a breakdown or accident occurs, and then quantitatively evaluates the impacts of identified risks on the cash flows of business plans.

●Second Opinion Service for Wind Power Companies

Sompo Japan Nipponkoa and Sompo Risk Management started offering a second opinion service in November 2016 for wind power companies that have purchased a fire insurance policy from Sompo Japan Nipponkoa. Through this service, they offer advice on how to handle various types of trouble that could occur in operations and maintenance. When consulted on wind power operations and maintenance, Sompo Risk Management compiles advice from wind power maintenance companies, experienced engineers and experts, and then provides it to the client.

●Insurance Due Diligence Service for Wind Power Companies

Sompo Risk Management offers insurance design services, with comprehensive risk assessment in consideration of the risk reduction effect by preventive maintenance efforts on operation and maintenance (O & M) of wind power companies, before arranging insurance for wind power facilities.

Development of Flood Risk Assessment Methods for Japan and Asian Countries

Products & Service

To deal with flood risk, which can be affected by medium- and long-term climate change, Sompo Risk Management is engaged in research and development into flood risk assessment methods for Japan and Asian countries to offer new insurance services and risk consulting services that support adaptation to climate change.
In Japan, Sompo Risk Management is utilizing a flood risk assessment system*1, developed jointly with Kyoto University and Kobe University, for insurance risk management and natural disaster risk consulting.
For Thailand, They are using a flood risk assessment system developed jointly with the Foundation of River & Basin Integrated Communications, Japan, to manage insurance risk and develop insurance products. They have also developed new flood scenario risk assessment methods*2 for major urban areas in Indonesia, the Philippines, Malaysia, Singapore, and Brazil. With these methods, They now have methods in place that enable them to assess flood scenario risks in seven countries in Asia (methods have already been developed for China, Vietnam, and Thailand), and one country in South America. They plan to steadily expand the area to which they can apply these flood risk assessment systems and methods.
In fiscal year 2015 they started new joint research with the Disaster Prevention Research Institute at Kyoto University and the Research Center for Urban Safety and Security at Kobe University, with the aim of enhancing the precision of flood risk assessments in Japan and Asian countries. Going forward, they intend to actively apply their flood risk assessment expertise to the management of insurance risk in Japan and other countries, the development of insurance and derivative products, and risk consulting services, in order to propose concrete and practical solutions.

  1. Flood risk assessment system: A system to assess flood damage stochastically over year, based on various assumed rainfall scenarios.
  2. Flood scenario risk assessment method: A method to assess flood damage under certain pre-set rainfall scenarios, including past heavy rainfall that has been measured, and probable heavy rainfall (e.g., rainfall of a certain intensity with the likelihood of once in 100 years).

Awarded "Highly Commented Paper 2017" by Journal of Flood Risk Management

Sompo Risk Management conducts joint research with the Research Center for Urban Safety and Security at Kobe University and Disaster Prevention Research Institute at Kyoto University from 2010 in order to develop the flood risk assessment method.
In this joint research, they developed a method to calculate economic damage due to flood by combining engineering rainfall outflow and flood simulation technology with technology to estimate stochastic insurance loss amount.
Sompo Japan Nipponkoa and Sompo Risk Management developed flood risk assessment methods in FY2015, and they utilize the method for risk management of insurance and risk consulting for enterprises.

Also, the academic papers for this basic model won Highly Commended Paper of Outstanding Paper Award 2017* by Journal of Flood Risk Management(hereafter,“JFRM”),which published by Wiley in the UK.

  • Outstanding Paper Award 2017 by JFRM
    JFRM is a specialized academic journal in the field of flood disasters, and the influence in this research field is large worldwide and has received high praise from researchers all over the world. Outstanding Paper Award is an especially excellent paper that is honored from all the papers published in this academic journal over the course of a year.