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As Q3 renewal planning gets underway, brokers managing small to midsize Control of Well (COW) accounts face increasingly difficult conditions. COW pricing keeps climbing even as abundant capital softens the broader energy insurance market. Domestic COW capacity has also narrowed sharply, leaving brokers to search overseas markets for coverage while the remaining U.S. programs grow more selective on terms. At the same time, geopolitical instability, a regulatory environment supportive of drilling, and the United States’ geographic advantages all point to a potential near-term increase in production, naturally introducing higher exposures. And finally, the very nature of COW risk is shifting. Plug-and-abandonment (P&A) work, not active drilling, is now the leading cause of well control events, and underwriting hasn’t fully caught up.
The resulting pressures these conditions create hit small to midsize accounts the hardest. These accounts were already an underserved corner of the market. Now, with less capacity at home and the potential for rising demand across the sector, they lack the capital to self-insure or the leverage to shop a shrinking list of U.S. markets.
Use the quick links below to jump ahead, or simply read on for a look at what’s happening in the Control of Well market at home and abroad and learn what you can do to make sure your accounts have the coverage they need.
Current market challenges
Geopolitics and a shifting domestic picture
Why COW pricing doesn’t match plug-and-abandonment risk
Where this leaves brokers
How Kinsale can help your small to midsize accounts
The bottom line is that COW simply isn’t getting the same share of capital as the rest of energy insurance right now. IMA Financial Group’s Energy Markets In Focus Q1 2026 report describes a broader energy insurance market that’s “meaningfully oversupplied with capital,” with rate decreases available across most lines. COW, however, is a surplus lines specialty that not many carriers are willing to take on, which means that there was never a wealth of domestic COW capacity to begin with. In an already small field, when even one carrier pulls back, the remaining players face less competitive pressure to hold pricing down.
Of course, none of this is to say that options aren’t out there. It’s just that current conditions favor large operations, so for brokers placing small to midsize COW accounts, finding a viable option is a greater challenge.
Overseas markets are a workaround for some, but lack consistency. Overseas syndicates currently hold the majority of COW capacity, so while coverage is there, it’s not a reliable source. IMA flagged several bad losses in 2025 that could trigger a correction by late 2026 or 2027, and some of these markets are pricing distressed accounts too cheap for their loss history[1]. When a market’s underpricing risk like that, it’s usually not sticking around. Likewise, some surplus lines carriers are writing aggressively, cutting rates 5 to 15 percent, but that relief mostly goes to bigger, well-run accounts, leaving smaller accounts facing relatively high minimum premiums and terms that don’t budge no matter what the headlines say.
Domestic capacity isn’t any more consistent. The instability story is the same domestically, mainly because that’s what a hard market does. Carriers get bought and sold, programs get restructured, and appetites change without warning. And the broader E&S market, where COW lives, is getting pickier, not looser: AM Best says the segment is “becoming increasingly more selective on terms and conditions” and raising the bar at renewal, even as growth slows[3]. For a small COW account with a modest well count and limited loss history, that selectivity plays out in the form of tighter terms, higher minimums, more paperwork at renewal, all before an outright declination. Brokers end up chasing quotes from carriers whose appetite keeps shifting, never sure which market will even be around by the next renewal.
Domestic activity, meanwhile, is on the edge of a potentially major increase, driven by three factors: geopolitics, domestic policy, and geographic advantage.
IMA points to Middle East instability, including a brief early-March disruption to Qatari LNG production and the current conditions in Iran, as a factor driving price volatility and supply uncertainty across oil and gas production[1]. This kind of geopolitical instability outside the US makes domestic drilling look like a safer option by comparison.
Policy adds another layer to domestic production’s appeal. WTW’s November 2025 review notes that regulatory evolution under the current administration is holding the door open for energy companies in North America, even as commodity prices keep capital and operating budgets under scrutiny[2].
Finally, the United States produces from a position few other major suppliers can match, insulated by two oceans, supported by its own supply chain, and less exposed to the shipping chokepoints that influence production and pricing decisions elsewhere.
Taken together, these conditions point toward a surge in domestic production, and with it, more strain on a market that’s already stretched thin, particularly for small to midsize operators.
Our look at the COW market wouldn’t be complete without examining how the risk itself is changing. Traditional drilling and completions once carried the highest blowout risk. P&A operations are now the most common cause of well control events [1], often involving poorly documented well histories, unexpected pressure pockets, compromised casing or cement integrity, and crews unprepared for a full control event. These events are costly, and it’s often small to midsize operators, non-operators, and contractors doing the P&A work, many holding aging, marginal wells that larger producers have already moved on from. This shift matters for agents, brokers, underwriters, and carriers alike, because P&A risk requires different pricing models and submission checklists than the ones built for drilling risk.
An Authorization for Expenditure (AFE) sets the anticipated cost of a project. Traditionally, COW coverage is built on the assumption that a loss could run roughly three times the project’s cost estimate, or 3x AFE. That math holds up for large-scale drilling projects: a high-cost AFE times three produces a limit that can realistically absorb the cost of an event. P&A work is different. These jobs are typically budgeted in the tens of thousands to low six figures—nowhere near the size of a drilling AFE. Run those budgets through the same 3x formula, and the resulting limit is sized to the job, not the risk.
A routine-looking P&A job on an undocumented legacy well can turn into a seven-figure claim in the space of one bad cement job. Anecdotal industry data suggests many losses for smaller operators land around or just under $2 million once costs for activities like control efforts, relief well work, and redrilling are accounted for. For a business running a handful of wells on tight margins, losses of this magnitude could end a business, a point we’ve unpacked in more detail in our earlier posts on what COW covers and the misconceptions that leave operators exposed.
Avoiding that outcome means underwriting the well itself, not a static 3x AFE number. Submissions need to show a well’s documented history, whether its casing and cement integrity are known, and whether it has changed hands along the way because inherited or divested wells are more likely to carry incomplete records. With this information, you can build programs that match cost to risk with limits that will adequately protect the insured.
Add it up, and here’s what brokers are facing heading into Q3: a domestic market with less capacity than it’s had in years, overseas options that are inconsistent at best, carriers whose appetite keeps shifting without warning, potential production increases that will only add more exposures, and pricing models that don’t match risk profiles. And in all of this, the small to midsize accounts remain underserved.
So, what’s the answer? Find a market that fits.
The market that brokers and their clients are facing right now is one in which expertise, consistency, and appetite matter. While the broader COW market has spent the first half of 2026 tightening, narrowing, and correcting, Kinsale remains a consistent domestic option built around the accounts feeling the most pressure, namely small to midsize operators, non-operators, and the contractors working alongside them.
Kinsale’s Energy team delivers coverages that include:
With focused expertise, real capacity, flexible underwriting, and a steady appetite, we are committed to being a dependable market no matter what the headlines read to where the broader market moves. If you would like to get a quote, send your submission to our Energy team at eg@kinsaleins.com. For general questions on coverage, eligibility, and pricing, see the full Control of Well FAQ on our product page.
[1] IMA Financial Group, Energy Markets In Focus Q1 2026, March 2026. https://imacorp.com/insights/energy-markets-in-focus-q1-2026
[2] Willis Towers Watson, From Fires to Fleet Safety: What’s Shaping Energy Insurance in North America, November 13, 2025. https://www.wtwco.com/en-us/insights/2025/11/from-fires-to-fleet-safety-whats-shaping-energy-insurance-in-north-america
[3] AM Best, Market Segment Outlook: US Excess & Surplus Lines Insurance, November 18, 2025. https://web.ambest.com/docs/default-source/events/market-segment-outlook—us-excess-surplus-lines-2026.pdf
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