Turkiye is showing rapid growth in renewable energy, and these investments are being closely followed by the insurance sector, according to Mr Murat Ciftci, CEO of Istanbul-headquartered IBS Insurance and Reinsurance Brokerage.
Solar and wind energy facilities are among the most widely insured installations. While insurability is possible in other fields such as biomass and geothermal energy, detailed risk analyses are required depending on the technical structure and location of the projects, Mr Ciftci added, according to a report by Anadolu Agency, a news organisation.
According to the Ministry of Energy and Natural Resources, as of the end of May 2025, the distribution of installed capacity by resources was as follows: 20.6% natural gas, 18.4% coal, 27.1% hydropower, 11.2% wind, 19% solar, 1.5% geothermal and 2.2% other sources.
Risks
Mr Ciftci said that the insurance sector is in a position to provide coverage for the transformation to renewable energy. He named the level of risk as one important factor that determines the insurance sector's interest in renewable energy investments.
The risk level—that is, the project's technical adequacy, location, and environmental conditions—is paramount during the insurance process. Furthermore, sustainability policies are also among the determining factors for the insurance industry. Projects not assessed within the framework of ESG (environmental, social, and governance) criteria currently attract limited risk appetite.
The most common risks encountered in renewable energy facilities include natural disasters, equipment failures, production losses, damage during installation, and technological incompatibilities. More modern risks, such as interruptions in the facility's remote monitoring systems or cyber threats, are also on the agenda.
Mr Ciftci said that climate change directly affects insurance coverage, and that events such as extreme heat, sudden hail, and drought are now addressed with special clauses in policy writing.
He emphasised that risk engineering processes require more proactive preparation for such events, stating, "There are also insurance products specifically developed for these investments. Solar and wind power plants cover not only material damage but also operational risks such as lost revenue and decreased production. Risk engineering is essential in these processes."
He pointed out that pre-installation site analysis, construction phase inspections, and maintenance plans aligned with sustainability criteria throughout the operation period are integrated.
Coverage
Mr Ciftci said that 'All Risks' policies are generally preferred during the construction process, noting that physical damage, workplace accidents and third-party liability are at the forefront during this period.
He pointed out that during the operational period, coverage such as production loss and machinery breakdown is implemented together with the 'All Risks' property insurance. He said, “Demand often increases during the transition period because the new system is being put into operation and equipment failures are more frequent during this period. For insurance companies, regular maintenance records, technical qualification documents, and quality control processes play a critical role in determining premiums. A well-managed facility offers a lower risk profile, resulting in more advantageous premiums."
IBS Insurance and Reinsurance Brokerage began operating in 1997 after acquiring its licence. In 2002, IBS established a partnership with United Insurance Brokers, an expert Lloyd’s broker in London.