PFAS: An escalating challenge for the insurance market
Robert Latimer, Environmental Risk Director, UK & Ireland
Per- and Polyfluoroalkyl Substances (PFAS) or “forever chemicals” are rapidly emerging as one of the most significant global environmental risk exposures confronting the insurance industry. Their persistence in soil and water, combined with mounting evidence of adverse health effects, has already led to multi-billion-dollar settlements in the US and an expanding wave of litigation across multiple sectors, and we would expect this to continue in 2026.
Regulatory momentum is also accelerating globally. In the US, PFAS are now listed as hazardous substances under the Comprehensive Environmental Response, Compensation and Liability Act, while more and more countries are setting drinking water standards for PFAS at parts-per-trillion (ppt) levels.
Against this rapidly shifting backdrop, the scale and cost of remediation are expected to rise sharply. These developments will create increasingly complex challenges for insurers, particularly given the lack of claims data and the potential for long-tail liabilities.
Insurers are responding with tighter underwriting criteria, widespread PFAS exclusions, and escalating premiums for environmental liability cover. For corporates, this evolving landscape also underscores the importance of early risk identification, robust due diligence on historical land use, and proactive engagement with brokers and technical experts.
With limited historical claims data and rapidly evolving regulations, PFAS represents a growing, systemic risk.
The new risk reality for renewable energy
Alan Tucker, Global Head of Renewable Energy
In 2026, the renewable energy sector will continue to face an evolving risk and insurance landscape as operational, technological and market pressures converge. Weather-related losses continue to rise, with hail the most damaging peril, particularly for solar facilities. Many assets are still adapting to evolving climate patterns, with design standards continuing to catch up.
The rapid expansion of mega-projects, such as large multi-tech generation / storage facilities and hyperscale data centres, is also amplifying the scale and complexity of losses. Incidents now often span multiple regions or assets, driving severity even higher. Replacement costs are escalating as well, with long lead times for components. Original Equipment Manufacturers (OEMs) help fill supply gaps, but reliance on unfamiliar equipment, spares and technicians increases risk.
Contractor error will remain a major claims driver. Fast-evolving technology and surging global demand have outpaced growth in the specialist labour needed to install and maintain renewable systems. A softer insurance market, with broader extensions and lower deductibles, will lead to increased claim frequency.
Compounding these issues, markets are being approached to insure new technologies with limited operating data under covers such as LEG2. Further, as digitalisation increases across renewable infrastructure, cyber exposures are also accelerating, creating a more complex risk environment for owners and developers.
The cyber insurance trends you can’t ignore in 2026
Paul Handy, Global Head of Cyber
Looking ahead to 2026, several trends reshaping how organisations manage digital risk are set to continue. Cyber insurance is becoming increasingly differentiated as insurers respond to the distinct needs of large corporates and the underdeveloped SME market.
Large enterprises are relying less on insurer-led incident response and focusing more on core risk-transfer factors such as coverage scope, pricing, and policy clarity. This shift reinforces the need for adaptable claims handling and specialist loss-adjusting capability.
Insurance penetration in the SME remains extremely low. It will continue to be a core target for many carriers particularly the mid-market sector. The sector requires flexible service models that can accommodate varying levels of cyber maturity.
As carriers refine their SME offerings, more structured, always-available incident-response models will continue to emerge. In a soft market, operational capability in claims and response is becoming an increasingly important differentiator.
Growth across segments will increase demand for scalable claims solutions that can supplement internal teams or provide specialist expertise.
Overall, the cyber market will continue to evolve in 2026. While loss ratios remain comparatively low, rising technological dependence, geopolitical volatility, and competitive growth pressures highlight how quickly the risk landscape could shift.
Rising fire risks in dwellings
Glenn Thornton, Head of Major & Complex Loss, UK & Ireland
The increasing use of high-energy devices in homes is increasing the risk of dwelling fires, a trend we expect to see intensify in 2026. Electric vehicles (EVs) present a growing domestic risk, particularly where home charging setups are improperly installed or use uncertified equipment. Fires originating in garages or basement parking areas pose heightened danger, with limited space accelerating fire spread into living areas.
Similarly, lithium batteries in e-scooters, e-bikes, and laptops continue to be a major concern. Counterfeit or low-quality chargers, combined with charging in confined or poorly ventilated spaces, increase the likelihood of overheating and internal short circuits. These fires are particularly hazardous, as lithium flames behave differently from conventional fires and can reignite even after the initial suppression.
Air fryers have also emerged as a growing ignition risk. UK Home Office data highlighted a 57% rise in incidents referencing air fryers between 2023 and 2024, as these become standard appliances in most kitchens. Factors including built-up grease, positioning of air fryers next to combustible items and issues with faulty wiring are all sources of ignition.
As domestic electrical loads rise and modern appliances become more powerful, these combined factors could drive an increase in fire-related incidents within dwellings throughout 2026.
For more insights from Crawford experts, visit our Built for the Future: 2026 U.S. Predictions report page.
