Green Insurance

Green insurance offerings are being offered by an increasing number of insurance companies. These insurance policies are designed to cover the replacement cost of homes or cars that are environmentally friendly. In 2006, Fireman's Fund was the first company to offer insurance on buildings constructed to LEED (Leadership in Energy and Environmental Design) certification. Since then, a number of different insurance companies have joined the green movement.

As the first insurance provider to offer green insurance, Fireman's Fund continues to provide discounted policies to homeowners in 36 states who build, renovate or rebuild a lost or damaged dwelling to green standards. Fireman's Fund recognizes that homeowners committed to state-of-the-art electrical, plumbing and roofing systems are less likely to experience loss or damage.

Lexington Insurance, an AIG subsidiary, began an "Upgrade to Green Residential" program in 2008. Farmers Insurance is another green insurer available to consumers in 27 states. Some insurers are offering green policies in limited areas, such as United Fire Lloyds and Central Mutual Insurance. Many of the nationally known insurance companies, while not yet offering environmentally friendly policies, are considering it and may do so in the near future.

Car owners have lots of options to get environmentally friendly insurance coverage. Hybrid vehicle owners are often eligible for discounts, For even more savings, insurers are offering "pay-as-you-drive" policies with steep discounts of up to 50 percent for drivers who use their vehicles substantially less to decrease greenhouse gas emissions. To make sure drivers are adhering to the mileage requirements, insurers place GPS or other mileage-tracking devices on the vehicles.

Several auto insurers offer green policies, including Travellers, Farmers, Progressive, Allstate, and GMAC. Many of these discounts reflect the fact that green drivers are more conscientious drivers, and also that they leave their cars at home more often. Some insurers are also offering discounts when insuring motorcycles that run on alternative fuels, such as electricity, biodiesel fuel, or hydrogen fuel cells, as well as battery-powered motor scooters.

If you do not own a green home, you can get an insurance rider that will cover your home in the case of a loss and then rebuild it to green standards such as LEED. Paying more than 5% extra for a green home insurance rider is most likely not worth the extra cost; however, considering how inexpensive home insurance is (typically 2% of the home's cost), 5% for a $300k insurance rider policy would only be $30/year.

Consumers concerned about the environment now have insurers who are willing to work with them to provide discounts that help offset the added costs of building green homes and driving hybrid fuel cars and motorcycles. As more insurers begin to see the benefits of offering insurance to these consumers, more discounts should become available.

For an in-depth comparison and detailed description of green insurance for homes, cars and even bicycles, please visit www.greeninsurancereviews.com.