Insurance often arrives only after the most expensive decisions have already been made. Stephen Norman, commercial director at Van Ameyde Marine, believes this is one of the biggest weaknesses in offshore energy projects. By the time insurers, marine warranty surveyors and assurance specialists become involved, many of the key design and procurement decisions have already been locked in.
After 37 years in the industry, first as a master mariner and now advising clients across warranty surveying, technology qualification and supply chain assurance, he has watched projects become larger, more technologically complex and increasingly interconnected while the sector remains fundamentally reactive.
"The reality is, however hard they try, they almost indefinitely end up in that position," Norman said. "The more proactive companies are the ones that tend to have lower issues on their projects."
Offshore energy is evolving rapidly. Floating wind, hydrogen production and carbon capture projects are expanding in scale and complexity, while the systems that underpin them are becoming increasingly interconnected.
Yet the assurance processes designed to reduce risk, from class verification to marine warranty surveying and inspection, remain "significantly undervalued most of the time."
Part of the problem lies in how projects assess consequence. Oil and gas has long operated under rigorous assurance frameworks because the potential impact on people is obvious. Renewable energy projects are often viewed differently, despite carrying substantial financial exposures and growing importance as critical national infrastructure.
"Renewables potentially has a higher critical national infrastructure impact, but has lots of smaller moving component parts," Norman said. "The consequence of project failure or systemic failure and its impact upon critical national infrastructure isn't often fully evaluated."
Commercial reality only adds to the pressure. Capital expenditure continues to rise, specialist installation vessels remain scarce, supply chains operate on tight schedules and construction windows are dictated by weather. By the time assurance is introduced, opportunities to influence project outcomes have already narrowed.
Supply chain risk remains underestimated. Technology lifecycles are shortening, with control systems, software platforms and specialist equipment becoming obsolete before projects are completed. If a critical component fails or is more importantly, damaged during transit/installation, or is made unavailable due to transportation challenges, then re-resourcing or replacing can be extremely challenging due to the manufacturing lead time.
"That is something that has to be identified at the very start of the project," Norman said. "When you start to look at your criticality analysis, you've got to look at where your supply chain comes from. That's before you then start looking at conflicts and bottlenecks."
Geopolitical disruption is compounding the challenge. Some projects rely on a single shipping route for critical components. If conflict, sanctions or extreme weather interrupt that route, delivery schedules can quickly unravel.
Climate-related risks are adding another layer of complexity, with changing weather patterns challenging assumptions that have traditionally underpinned offshore projects.
"Some of the things that we are designing for do not take into account climatic events," Norman said. "We've got to be better at understanding what impact that may have."
The consequences of those early decisions often return to insurers, even though the underlying issues originated long before cover was placed.
"When it comes back into the insurance markets, who is picking up the cost of failure is often borne by the insurance industry. And the reality is the insurance industry isn't there to fund research and development."
Digitalisation is delivering genuine benefits where it improves visibility rather than simply automating existing processes. Continuous assurance, stronger document control and digital motion monitoring can identify problems earlier and improve understanding of how transportation affects a structure's fatigue life. Drones are also making inspections possible in locations where, as Norman put it, "humans can't."
The integration of cyber risk into offshore infrastructure, however, is developing faster than the industry's understanding of it.
"I don't believe the cyber connectivity of projects is very well understood at the moment," he said. "And that will be an area which will increasingly be tested and evolve over time."
Artificial intelligence could also improve transparency, although Norman warned that better understanding of risk could attract additional capital and put further pressure on pricing.
The biggest difference between successful offshore projects and those that experience delays, disputes and losses is not the quality of insurance they buy but when assurance becomes part of the conversation.
"Typically, right at the end during the execution phase, companies tend to go out and bring in their insurance cover," he said. "That means that from an actual hands-on marine warranty perspective, or from an inspection perspective, that's only being brought in at a very late stage, and that's very much a transfer of risk."
Projects that integrate certification, class verification, warranty surveying and supply chain scrutiny from the earliest design stages are better placed to avoid costly redesigns and schedule overruns. The later problems are identified, the more expensive they become.
The industry also struggles to retain knowledge between projects. Teams disperse once construction finishes, taking valuable experience with them. Organisations such as the Lloyd's Market Association and the Joint Rig Committee help improve transparency and share lessons across the market, but there is still more to do.
"It really plays back into everything," he said. "If you get a handle on that, then you manage your vessels, you manage your supply chain, you manage your connectivity, and your contract mechanism can be better understood because there is a fairer and more equitable transfer around the risk."
For Norman, the industry's biggest risks are often created long before insurance is placed. The earlier projects embed assurance into design, procurement and planning, the less there is left for insurance to solve.
