Lexington Insurance, a Chartis company, has introduced a new energy investment tax credit insurance program, ITC Energy - 48, to protect owners, developers and investors against financial losses arising from the loss or damage to energy property.
The insurance program consists of ITC Energy-48 mobile property insurance and ITC Energy-48 professional liability insurance products.
Lexington said that the insurance program also responds to the resulting recapture of investment tax credits that were granted for such property, pursuant to Section 48 of the Internal Revenue Code (IRC).
According to the Lexington, the ITC Energy-48 Mobile Property Insurance provides replacement cost coverage for direct physical loss or damage to mobile energy property.
In addition, the mobile property insurance coverage reimburses insureds for any resulting loss or recapture of energy investment tax credits. The policy also reimburses the insured for the cost of fines and penalties that may be assessed by the IRS relating to the recapture of investment tax credits.
ITC Energy-48 Mobile Property Insurance extends coverage for business interruption loss, inclusive of unbundled renewable energy certificates sold to third parties, as well as any production tax credits taken in lieu of investment tax credits.
Coverage will be extended as well for energy property while it is in transit between scheduled locations. Insureds can elect multi-year policies to cover their exposures during the five-year tax credit compliance period.
ITC Energy-48 Professional Liability Insurance provides defense and indemnity coverage for the errors and omissions of a policyholder who is managing, operating and maintaining energy property.
This coverage is structured to respond to professional liability claims from limited partners seeking recovery for the loss or recapture of investment tax credits as a result of non-compliance with the requirements of Section 48 of the IRC. Policies are issued on an annual basis.
Lexington Insurance Liz Carmody, senior vice president Liz Carmody said that Lexington’s ITC Energy-48 Insurance Program is designed to insure energy property against casualty losses as well as the loss of investment tax credits due to a casualty loss or non-compliance with the IRC.