Energy transition resulting from climate change continues to transform industry risk landscape, according to Willis Towers Watson

About this update from Willis Towers Watson Public Limited Company

[{"type":"text","content":"Increasing need for energy transition strategies forms key theme of Willis Towers Watson’s annual Energy Market Review\nLONDON, April 09, 2021 (GLOBE NEWSWIRE) -- Climate change and the resulting energy transition continues to transform the energy industry risk landscape, and remains the dominant issue facing the sector, according to Willis Towers Watson (NASDAQ: WLTW), a leading global advisory, broking, and solutions company, at the launch of its annual Energy Market Review. The report outlines how the global energy system is currently being overhauled, with the threat of flows of fossil fuels from fields around the world, through pipelines and tankers to refineries near to consuming markets, disappearing or changing radically to more renewable energies such as wind, wave and solar power. Conditions in almost every arena of the Energy insurance markets continue to harden, although rate increases are expected to be more moderate for some risks. The Report outlines the following: Capacity: Total theoretical capacity has now increased for both Upstream and Downstream Property, and now stands at US$9.2 billion and US$6.2 billion respectively, depending on region and risk profile. However, management pressures continue to prevent much of this capacity from being deployed in practice, and realistic levels now stand at US$7.0 billion and US$4 billion respectively. For Liability, overall theoretical levels remain static at around US$3.0 billion, but realistically stand at US$1.0 billion for most Energy business, depending on region and risk profile.Profitability: Both the Upstream and Downstream Property markets are likely to prove profitable for 2020, whereas the Liability portfolio continues to run at an overall loss.Rating levels: A two tier market has developed for Property business, with sought after business featuring a good spread of risk and premium income attracting more moderate rate rises than the remainder of the portfolio. Liability rating increases continue to depend heavily on the amount of programme limit required. Graham Knight, Head of Global Natural Resources, Willis Towers Watson, said: “In the past 12 months we have seen some quite extraordinary developments around oil price, demand destruction and an even sharper focus on environmental, social and governance issues and so there is no denying there are increasingl...

More updates from Willis Towers Watson Public Limited Company