Munich Re has launched an insurance policy for battery manufacturers to insure against the risk of their products not delivering as promised.
The Germany-based insurance group said the move would allow manufacturers to offer long-term performance guarantees, “whose value is backed by the insurance coverage”.
And US-based all-iron flow battery maker Energy Storage Systems confirmed it was including 10-year insurance coverage on its long-duration energy storage products through Munich Re.
The insurance cover offered by Munich Re is primarily aimed at major projects, such as those ensuring grid stability or covering peak demand needs.
However, Munich Re said its product would be launched onto the mobility market in a second phase, “for example to insure performance of batteries in electric vehicles”.
The insurance allows battery manufacturers to insure their customer warranties, such as if the repair or replacement costs of defective or weak battery modules exceed a predetermined amount. According to Munich Re, “it will also become easier to obtain project financing, because the maximum costs for any warranties are capped by the insurance cover”.
Peter Röder, member of the board of management at Munich Re, 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.”