Tornadoes represent one of the most destructive and fast-moving threats facing the renewable energy sector. Even weak tornado events—as low as EF-0 on the Enhanced Fujita scale—can cause catastrophic damage to solar panels, triggering significant asset losses and financial penalties. The scale of this threat has never been clearer: Severe Convective Storms (SCS) generated approximately $68 billion in economic losses and $52 billion in insured losses in the United States in 2025, with 19 separate billion-dollar events recorded, highlighting both the severity and frequency of these events. The solar industry is particularly exposed due to the large footprint, remote locations, and high replacement costs of utility-scale installations. The financial consequences extend well beyond physical damage, impacting Power Purchase Agreement (PPA) obligations, lender repayments, and tax-equity financing structures.
Descartes' parametric tornado insurance for solar farms in the United States offers a transparent, data-driven solution built specifically for the unique exposures of utility-scale PV installations. Combining NOAA tornado track data with Planet Labs' very high-resolution satellite data, the product triggers payouts when a tornado enters the mapped area of the insured location and satellite data confirms panel-level damage—no lengthy claims process, no deductibles, no uncertainty.
How it Works
- Insured Location Mapping: At policy inception, the coverage area is defined using the precise GPS coordinates and layout of the solar farm's PV installations, establishing the exact trigger perimeter for the policy.
- NOAA Tornado Identification (Trigger 1): NOAA's official tornado track database is continuously monitored. If a tornado is recorded as having passed through the insured location, the first trigger condition is met.
- Planet Labs Satellite Tasking (Trigger 2): Upon confirmation of a tornado track, Planet Labs' high-resolution satellites capture post-event imagery of the insured location and assess the precise percentage of the area damaged at the panel level.
- Independent Verification: A certified third-party agent processes the raw satellite imagery, superimposing it onto the mapped insured location to determine the percentage of the area affected and confirm payout eligibility—ensuring full impartiality.
- Proportional Payout: The payout is calculated by multiplying the percentage of the insured location area damaged by the policy limit. For example, if 20% of a solar farm insured for $50 million is affected, the payout equals $10 million—issued rapidly, without manual loss adjustment.
Why Choose Descartes’ Parametric Tornado Insurance?
✔️ Panel-Level Satellite Precision
Our solution leverages Planet Labs' high-resolution satellite imagery to assess damage at the individual panel level. This granular approach significantly reduces basis risk, ensuring that payouts accurately reflect the actual extent of damage to an installation.
✔️ Rapid Liquidity When It Matters Most
Parametric payouts are triggered and verified without the months-long manual loss adjustment process typical of traditional insurance. Solar farm operators receive funds quickly, enabling them to address repair costs, meet PPA obligations, and stabilize financial commitments to lenders and tax-equity investors.
✔️ Tailored for the U.S. Solar Industry's Unique Exposures
This product is purpose-built for utility-scale solar farms, covering a broad scope of tornado-related damage including microcracking, panel shattering, and cascading rack failure. It directly addresses the financial exposures most critical to solar project economics—high retentions, PPA penalties, and default risk on project finance structures.
✔️ Combinable with Hail Coverage for Comprehensive SCS Protection
This cover can be seamlessly combined with Descartes' radar-based parametric hail product, offering solar farm operators a complete financial shield against two significant severe convective storm perils.
Want to Learn More?
Download our product sheet (PDF) to:
- Learn more about our satellite-based tornado solution for solar farms, quote requirements, and more.
- View an example use case.
- Discover more details about the product in our Frequently Asked Questions section.
Interested in a solution?
Contact our commercial team.
FAQ
How is the coverage area determined?
The coverage area is defined by the precise layout of the insured location(s), as outlined in the solar plant’s location information shared by the client or broker.
How can the data source confirm the percentage of damage?
The damage assessment is done by experts in optical imagery who leverage advanced techniques to accurately detect solar power plant damage, e.g., snapped or severely damaged panels.
How is a tornado policy triggered?
Two events must occur for the policy to pay out:
• A tornado track of at least EF-0 passed through the insured location(s), as reported by NOAA.
• The high-resolution satellites detected damaged solar panels at the insured location.
How is damage detected?
We leverage very high-resolution (1.6ft) satellite imagery to assess the percentage of the insured location’s area that was damaged by the tornado.
To ensure impartiality in data processing, we commission an independent third-party agent to certify the data used to determine payouts.
If the tornado’s path has breached the predefined insured location’s area, the third-party agent processes the raw satellite imagery and superimposes them onto a map depicting the insured location(s) to determine if the client is eligible for a payout.
Why is this product dedicated to solar farms?
Given the rising prevalence of severe convective storm (SCS) events coupled with the remote locations of many utility-scale solar power plants, we recognized the need for tailored insurance solutions that address its unique exposures and therefore safeguard the industry effectively.
How does this product compare to the parametric EF-scale product?
The EF-scale parametric product is fully applicable to large structural buildings, however, looking solely at an EF-scale to determine damage to solar panels increases basis risk and therefore potential inaccuracies to the detriment of the Insured. Our research has shown that a satellite-based parametric approach significantly outperforms the EFscale approach when it comes to adequately capturing historical events, resulting in optimized modeled payouts for solar power plants at reasonable rates.
Is this a stand-alone cover or can it be combined with others?
Both tornadoes and hailstorms present significant risks to the utility-scale solar industry, leading to asset damage and financial loss like PPA penalties.
To address these challenges comprehensively, Descartes provides full financial protection for solar project owners by combining our satellite-based tornado cover for solar plants with our radar-based parametric hail product.
