Indemnity Against Wind-Turbine Fires: An Estimate of the Cost of Overcoming Information Asymmetry

Abstract Individual wind energy generators and entire wind farms have grown larger in recent times; the larger among the machines are less easily accessible for preventive and corrective maintenance. A large proportion of wind farm assets remain uninsured against fire damage and insurance companies need to come up with effective mechanisms to elicit information relating to the fire risks faced by the underlying assets and then to design and deploy the means to absorbing and diversifying such risks. The present paper offers suggestions to acquire information to bridge the apparent information asymmetry and to defray the associated risks more efficiently.