Nigeria is taking a significant step in accelerating its energy transition with the launch of dedicated clean energy insurance, aimed at protecting small and medium enterprises (SMEs) investing in renewable energy. Casava, Nigeria’s first licensed digital microinsurance company, has partnered with cleantech financier Rivy to introduce the country’s first comprehensive clean energy insurance suite, covering solar panels, inverters, and delivery logistics. This development addresses a longstanding barrier that has hindered widespread clean energy adoption: the lack of financial protection for capital-intensive renewable energy investments.
Why Clean Energy Insurance Matters
The introduction of clean energy insurance is pivotal for Nigeria’s SME sector. Over 85 million Nigerians currently lack reliable access to electricity, and SMEs, which employ more than 80% of the country’s workforce, lose an estimated 10-20% of annual revenue to inconsistent power supply and high-cost diesel generation. With the Nigerian Electricity Regulatory Commission (NERC) increasing Band A tariffs by 300% in 2024, SMEs are under mounting pressure to find sustainable and cost-effective alternatives.
Solar energy adoption, now the most viable option, requires substantial upfront investment, often ranging from ₦500,000 to ₦5 million. The lack of insurance coverage for theft, accidental damage, and logistical losses has historically deterred businesses from committing to solar installations. By mitigating these risks, clean energy insurance unlocks the financial confidence necessary for SMEs to invest in renewable energy.
How It Affects Businesses and Households
For SMEs, the partnership between Casava and Rivy provides an integrated solution that combines financing and insurance, ensuring assets are protected from warehouse to installation. This end-to-end coverage minimizes financial exposure, reduces project risk, and encourages wider adoption of solar power. Households indirectly benefit as SMEs reduce dependency on expensive diesel generation, leading to more reliable and affordable electricity in local communities. In the long term, this could also reduce operational costs for businesses that provide essential goods and services, further supporting household consumption and economic resilience.
Green Insurance as a New Category
The Casava-Rivy initiative introduces a new insurance category for Africa. The partnership provides two core products under clean energy insurance: Solar Asset Protection, which insures panels and inverters against theft, vandalism, and accidental damage; and Logistics and Delivery Insurance, which safeguards solar equipment in transit. Integrated into Rivy’s digital financing platform, the solution allows SMEs to secure both insurance and financing in a single, streamlined process. Casava’s digital-first approach ensures quick policy issuance, mobile accessibility, and fast claims processing, making insurance an enabler rather than a barrier to clean energy adoption.
Driving ESG and Climate Goals
The launch positions clean energy insurance as a tool for achieving Environmental, Social, and Governance (ESG) objectives. By protecting renewable energy investments, Casava and Rivy facilitate the growth of Nigeria’s off-grid solar market, which is projected to reach $9.2 billion by 2030. The initiative also supports Nigeria’s Nationally Determined Contributions (NDCs) under the Paris Agreement, which target a 47% reduction in greenhouse gas emissions by 2030. Beyond financial protection, the partnership pioneers data-driven, parametric insurance models, using IoT and real-time monitoring to shift coverage from reactive claims settlement to proactive risk prevention.
Impact on the Renewable Energy Market
The introduction of clean energy insurance could catalyze the adoption of solar solutions among SMEs at scale, creating a replicable model for other African markets. By addressing the risk barrier, the insurance model enhances investment confidence, encourages growth in renewable energy infrastructure, and protects billions of naira in assets. This development also creates new business opportunities for insurers and financiers, demonstrating that digital insurance can be a critical enabler of climate resilience.
Future Outlook: Insurance as Climate Infrastructure
Casava and Rivy envision clean energy insurance as a foundational pillar for Africa’s broader renewable energy ecosystem. Future innovations include parametric insurance triggered by measurable weather events, performance guarantee policies for solar output, and integration with carbon finance platforms to provide additional value to insured assets. As Nigeria implements its Insurance Industry Reform Act, which increases insurer capitalization and expands coverage categories, digital-first insurers like Casava are well-positioned to leverage massive growth opportunities at the intersection of insurtech and clean energy.
The launch of clean energy insurance represents a transformative step for Nigeria’s energy transition. By de-risking renewable energy investments for SMEs, Casava and Rivy are not only enabling more sustainable power adoption but also contributing to broader economic resilience and ESG objectives. As this insurance model scales, it promises to create a more secure, reliable, and inclusive energy landscape, with benefits extending from businesses to households nationwide.