Dutch ICMIF member Univé has announced that it now provides more extensive insurance cover for businesses for the consequences of fires involving solar panels. In the agricultural sector in particular, the cooperative insurer is seeing a growing interest in generating and using solar energy. As the use of solar panels grows there is an increase in the risks that they pose in the event of a fire. If solar panels catch fire, they can explode and tiny glass and metal particles will spread around the area around them. This follows a warning by the Dutch Association of Insurers which had concluded that the Netherlands is insufficiently prepared for the outcome of fires involving solar panels.

“Cleaning up this is complex, time-consuming and expensive,” says Erik Dokter, Insurance Company Manager at Univé. “Until recently, the insurance industry had no answer to this risk.”

Solution for climate, risk for environment

Univé believes solar panels are indispensable for the energy transition and thus contribute to solving climate problems, but they also entail an environmental risk in the event of a fire. When glass and metal particles sometimes descend into waters, meadows and residential areas as a result of a burning panel, this is dangerous for children, pets, wildlife and livestock, according to Dokter.

High levels of risk for entrepreneurs

Dokter explains: “This is why an affected area must be thoroughly cleaned. Because it often involves many hectares and sometimes almost invisible particles, this is a time-consuming operation that can cost in the millions. We see an increasing interest among entrepreneurs in making their business more sustainable by means of solar panels. In addition, a solar roof will be mandatory from 2025 for all new large buildings and therefore also commercial buildings. The increase in the number of solar roofs increases the chance that more solar panels may also fail in the event of a fire, with consequences for companies using them, among other things. Now entrepreneurs have to deal with it themselves if their company suffers the consequential damage of a fire. That risk is too great to bare for the companies and as an insurance sector we have to anticipate that.”

Expansion of insurance cover for clearance costs and environmental damage

A few weeks after the Dutch Association of Insurers concluded that the Netherlands is insufficiently prepared for a fire with solar panels, Univé was one of the first insurers to expand insurance cover to offer entrepreneurs certainty for this scenario. As a result, members of the cooperative facing costs for clean-up and environmental damage are automatically insured from September 2022 for consequential damage due to fire to their solar panels.

Growing popularity among farmers

With the extension of both types of insurance cover, Univé expects to provide security for many agricultural entrepreneurs in particular. The cooperative insurer has a significant share in the agricultural sector and knows that farmers and horticulturists will make a significant contribution to the energy transition. According to recent research by agricultural news platform Nieuwe Oogst, more than half of the agricultural companies use solar panels or other forms of sustainable energy. Another quarter would opt for this if the capacity of the energy grid were not so limited. In addition, it became clear at the end of May that high energy prices are also causing a growing interest in solar panels among farmers. According to research by market research agency AgriDirect, a quarter of dairy farmers who do not yet have a solar roof are now prepared to invest in it for this reason, whereas this percentage was only 10% in 2021.