Green Building Insurance Industry ‘Booming’
The green building insurance market is competitive and growing, the Insurance Journal reports, with green construction industry driving this growth.
By 2015, between 40 percent and 48 percent of new non-residential construction, when measured by value, will be environmentally friendly. That equates to a $120 billion to 145 billion opportunity for the insurance market, the news service reports.
Green building is also gaining traction in the residential building sector. According to McGraw Hill Construction, green residences could account for as much as 20 percent of housing starts by the end of 2013. That’s compared to just 2 percent in 2005, and between 6 percent and 10 percent in 2008.
The growth of green building has led insurers to provide green building-specific products. Such is the growth in this sector that green insurance market pioneers Fireman’s Fund Insurance has seen its growth in this market slow as other companies have developed competing products.
Travis Pearson, president of CMR Risk & Insurance Services, says that almost every insurance company offers some sort of upgrade on their insurance products. Steve Bushnell, a senior director at Firemen’s Fund, now describes the market as “mainstream.”
But with these options, has come “mass confusion,” according to Pearson. Many green building owners don’t realize that such products exist and many don’t realize that they need specialized insurance for their green building, he says.
Sticking to its green credentials, Fireman’s Fund installed six fuel cells from Bloom Energy technology at its Novato, Calif., site, in 2011. The technology allow the insurance company to produce 60 percent of its energy needs for that location, reducing the firm’s carbon footprint by 15 percent.
Of the initial $5 million investment $3 million was covered government incentives for self generation.
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