For the majority of proposed wave- and tidal current-driven power generation applications, the electrical generators are submerged in sea water, frequently at many metres of depth. The environment places significant stress on the rotating or translating seals between the driven shaft and the electrical generator leading to reduced reliability and lifetime. A potential solution is to eliminate the seal, thereby flooding the generator and allowing sea water to circulate around the shaft, windings and rotor of the machine. The impact of immersing the windings of the machine in sea water is assessed here. Specifically, the impact that the insulation has on the leakage capacitance as well as the consequent impact the leakage capacitance has on current and voltage oscillations in the switching converter used to excite the winding is assessed. Thermal tests are conducted to assess the impact of the insulation on the thermal conductance of the coil–insulation system. Experimental evidence is provided.