Fireman's Fund Offers Green Insurance for Homeowners

Fireman's Fund Offers Green Insurance for Homeowners

Fireman's Fund Insurance Company is offering a green insurance option to homeowners in 26 states starting this summer.

The coverage allows policyholders who own green homes and those who own conventional homes to rebuild to the latest environmental safety and efficiency standards after a loss.

“We believe this is a trend-setting insurance solution for homeowners who are interested in the many benefits of 'going green' at home,” said Donald Soss, chief underwriting officer for Fireman's Fund Personal Insurance, in a statement.

The Fireman’s Fund residential green coverage option launched in Illinois in June and expands to more than a dozen states this month. It extends to the remainder of the 26 states in August, including California where it will be available as of August 1. The company said it expects to offer the coverage in most other states by the end of the year.

Michelle Moore, vice president of policy and public affairs for the U.S. Green Building Council, praised Fireman’s Fund for offering the product.

“Certainly with regard to green homes and in the insurance arena, this is an important leadership move,” Moore said. “It’s a bellwether to green practices in the home-building markets at large.”

Fireman's Fund, which is based in Novato and is a member of the Allianz Group, was the first property and casualty insurance firm to offer green insurance to the U.S. commercial marketplace in fall 2006. The company’s green option for homes is a “first in the residential marketplace as well,” Moore said.

The company is the first admitted carrier to broadly offer such coverage in the United States. Admitted carriers are licensed by states to sell insurance.

Lexington Insurance Co., a division of AIG, launched a similar green policy for homeowners last year. It is not available in California, but can be bought through surplus lines brokers.

In California, the Fireman's Fund green home coverage will be offered as part of the company's Prestige Home Premier Policy. The company declined to say how much the coverage would cost in the state, adding that size and location among the factors that would affect estimates.

Outside California, the new coverage will be available as an add-on to regular policies. Fireman's Fund said the annual premium would be about $70 per $1 million in insured value.

Policyholders whose homes are already green will be offered a 5 percent discount on the coverage, applied to the homeowner premium, the company said.

Under the coverage, policyholders whose homes are damaged can make repairs with green alternatives. Policyholders whose homes are destroyed can rebuild to Leadership in Environmental and Energy Design (LEED) standards set by the U.S. Green Building Council.

Green alternatives for rebuilding and replacement include Energy Star-rated appliances, roofing, insulation, electronic equipment and lighting; Energy Star upgrades to heating, ventilation and cooling systems; Forest Stewardship Council-certified wood for flooring, ceilings, millwork, siding and framing; nontoxic carpeting and paints; and water-saving plumbing fixtures. The coverage also provides for debris removed after damage to a home to be recycled and diverted from landfill, Fireman's Fund said.

"I think it's great," Mark Berman, a principal of the Davis Energy Group (DEG), said of the new coverage.

Reconstruction of a home after a loss gives homeowners -- and the builders who help them -- a chance to have a profound effect on the lives of the current and future residents and their communities, said Berman, who oversees management of DEG's role as the LEED for Homes Pilot Program provider in California and Nevada. "It's something that has an effect for 50 to 100 years," he said. "I think it's very smart to understand when such opportunities arise."