When considering providing cargo coverage for wind turbine projects, underwriters
should first determine the insured’s needs and whether or not DSU coverage may be
needed. Transport information should be developed to conduct a risk assessment and to
determine the appropriate terms and conditions of coverage, as well as values and
exposures. Typically, survey warranties would be placed in the policy, requiring a
marine surveyor to approve the load, stow and securing at each leg or hand-off point for
the shipment of the major components or any Critical Cargo. For inland wind turbine
projects, this would include:
• Over-the-road transport from the manufacturer’s factory to the port,
• depending on Incoterms.
• Unloading and pier storage at the port of loading
• Loading, stow and securing aboard ship
• Discharge and pier storage at port of import and determination of how
• long the equipment will be exposed on the pier.
• Truck or rail loading surveys for transport to the job site
• Discharge survey at the job site and receipt inspection
These types of projects can be very survey intensive, although some underwriters may
waive inspections of repetitive shipments that are sourced from the same manufacturer,
shipped through the same terminals, and transported by the same ocean and inland
carriers. Nonetheless, loss control costs for these projects can be considerable.
Although 2010 saw the number of new wind turbines installed drop nearly 50% from
2009, according to the WEA, the average annual growth for the wind turbine industry in
the U.S. has been 35% per year, over the past 5 years. Also, three major wind turbine
manufacturers opened manufacturing plants in the U.S. in 2010. Current tax credits for
any contracted wind turbine energy projects are scheduled to expire at year end of 2012.
The current high prices for carbon based fuels and the projected long term energy needs
by booming countries like China and India make it likely that forms exploitation of
renewable energy, such as wind turbines, will continue to be part of the world’s energy
strategy.
With federal mandates for states to meet specific targeted percentage of energy
produced by renewable sources, it is certain that despite the current economic conditions,
underwriters will continue to see these types of risks presented.