Guarding Your Green Building Investment
While GBLU has written extensively about green building bonds, a reader recently pointed out that green building insurance should not be overlooked.
When you talk about green building insurance programs, you have to start with Fireman's Fund. Back in October 2006, Fireman’s Fund had the foresight to launch three products for commercial green buildings, just ahead of the green building curve. Below is a summary of three of the insurance programs offered by Fireman’s Fund as part of its “Green-Gard” insurance suite.
• Green-Gard Certified – If you have a loss on your green-certified property, Fireman’s Fund will pay to rebuild and replace to recognized green specifications. This includes coverage for vegetated roofs, alternative power systems and alternative water systems.
• Green-Gard Upgrade - This coverage is specifically designed for those who have not yet made green upgrades, or have not attained green certification from the U. S. Green Building Council (USGBC). If you have a total loss, Fireman’s Fund will pay to rebuild your structure, from top to bottom, as a green-certified building.
• Green-Gard Commissioning - For any loss that exceeds $10,000, Fireman’s Fund will pay for a professional commissioning engineer to oversee your building’s repairs and inspect new or repaired systems.
One interesting component of the Green-Gard Certified program is that if green building certification requirements have changed since the owner built or upgraded, the additional cost of meeting the new specification is covered. GBLU has often wondered what will happen when LEED v. 3 is released in 2009 and cities have regulations on the books requiring compliance with previous LEED rating systems. Fireman’s Fund has already accounted for this development.
So what other green building insurance programs are out there?
There are several insurance carriers that have addressed either existing green buildings (Travelers, Liberty Mutual) or current traditional buildings with the option to upgrade to a green building (Fireman's Fund, AIG/Lexington). I have done extensive research on comparing and contrasting each of these property insurance policies as well as reviewing the insurance community's consideration of green building practices within their casualty, pollution, and professional liability coverage forms. I would be available to speak further on this topic if you wish and have prepared a presentation targeted to the green building community highlighting the risks and rewards of green construction.
Mark Rabkin
Broker, Althans Insurance Agency, Cleveland, OH
440 893 3141
Greetings,
I agree with the comments of Mr. Rabkin outlining many of the property markets available for green buildings. Importantly, many brokers fail to properly endorse the COC to cover potential gaps related to LEED certification costs, re-commissioning and the like.
Our agency has developed the first (that we know of) architects & engineers professional liability program that is available nationwide. The policy specifically includes a broad definition of professional services and perhaps as importantly, includes proactive risk management services that assist the professional in limiting their exposure to claims.
If your readership would like to know more, they may visit www.argogreen.com or call me at 925-852-0410.
Bill Ferree, CIC
ARGO Insurance Brokers, Inc.
Hello,
I am an attorney in the legal department of a title insurance company. In March, a colleague and I presented the basics of LEED certification and draft title insurance policy endorsements to the California Land Title Association Forms and Practices Committee. The presentation was not sanctioned by our company.
Although the reception was lukewarm at best, the interaction started a dialogue that could result in a viable title insurance product in the future. The problems are the same as in other aspects of sustainability, that is, education and motivation. Once the issues are clear and there is some economic incentive, companies will take action to incorporate sustainability into their operating procedures as well as in the products they offer. Kudos to Farmer’s Fund for blazing the trail.
Jeff Howell
Jeffreyhowellesq@gmail.com