Tokio Marine GX report urges insurance market to close ‘protection gap’ as new risks reshape green transition
Insurance solutions are failing to keep pace with the risks that come with the speed of clean technology growth, creating a dangerous and growing ‘protection gap’ that threatens the success of the global green transition, warns Tokio Marine GX (TMGX) in a new market insights report launched recently.
The report, It’s Not Easy Writing Green: How can insurers step up to support a resilient green transition? draws on over 25 years’ worth of data and experience accumulated by specialist renewables underwriter GCube Insurance leading up to its evolution into Tokio Marine GX on 1 September 2025. It reveals how the green transition has evolved into a more complex and interconnected landscape that existing insurance products struggle to address.
New risks outpacing coverage
Climate-related risks now emerge in regions once thought to be low-risk. Supply chain disruption continues to impact global markets. Power grids struggle to keep up with the integration of new capacity.
Larger renewables projects, new co-location models and emerging green transition technologies, such as hydrogen and carbon capture, are central to the transition, but they also bring unfamiliar exposures that are more difficult to manage.
These developments are not in themselves negative, the report stresses, but they underline the importance of insurers adapting to provide the right kind of support. While new capacity has entered the market, there remains a critical shortfall in the specialist knowledge to assess these evolving risks.
As a result, projects may not receive coverage that reflects the true nature of their exposures – what TMGX calls the ‘protection gap’ – a mismatch between the needs of those driving the green transition and the products currently on offer from insurers.
Fraser McLachlan, Chairman, TMGX, said: “The green transition is one of the defining undertakings of our time, and insurance has a central role to play in helping it succeed. But it is not enough to simply provide capacity. What is needed is the expertise and experience, insurance product innovation and global collaboration to ensure that risk is shared fairly and that projects have the resilience to move forward. Closing the protection gap is how our industry can make a real difference.”
Three critical areas require action
TMGX identifies where insurers must strengthen their support:
- Greater investment in data and analytics will help the market build a more reliable picture of risk as new green transition technologies come to new and existing global markets
- More open collaboration between insurers, brokers and lenders will improve transparency and make risk management more effective
- Targeted product innovation needs to fill gaps in areas such as tax credit exposures and carbon capture projects.
Oliver Litterick, Head of Renewables, TMGX, added: “In the global clean energy market, we’re seeing a perfect storm of challenges, from geopolitical shifts to climate volatility and supply chain fragility. If insurers want to be effective stewards of the green transition, they need to move beyond reactive coverage and build long-term capacity strategies that reflect the complexity of today’s risks. That’s what sustainable support looks like.”
By bringing these strands together, the report argues, the insurance market can reduce volatility and create the stable conditions that the green transition requires.
Leading by example, TMGX is expanding its product offering beyond renewables into multiple green transition sectors, committing up to $500 million in capacity for single risks. In doing so, it is building on GCube’s decades of specialist clean energy underwriting knowledge, alongside the expertise of the wider Tokio Marine Group.
