Home insurance incentives make it easier to be green

Jill Overmyer

Many insurance providers are offering incentives to environmentally conscious home and business owners. If you rebuild after a disaster, for example, some insurance companies will cover any increased costs of using earth-friendly materials and building methods. Or if your home or business meets certain green certification standards, you could receive a premium discount.

So what exactly does it mean to go green? Building with green alternatives includes:

  • Alternative energy sources, such as wind power or solar power.
  • Energy Star appliances, heating and cooling systems, lightning and electronics. Energy Star -qualified homes are those that meet strict standards for energy efficiency from the Environmental Protection Agency.
  • Non-toxic paints, carpeting and flooring.
  • Plumbing and fixtures with water-saving features.
  • Recycling of debris rather than disposal in a Dumpster or trash service, keeping it away from landfills.

According to a 2008 report from environmental advocacy group Ceres, insurers have found a correlation between green homes and buildings and lowered risk, which is why many companies are promoting green improvements. Travelers Insurance, for example, has noted that commercial property owners and homeowners who carry out green practices are more risk-management-minded and tend to be in lower risk categories. Additionally, green appliances and heating and cooling systems are safer, as they run cooler on less electricity, minimizing the risk for fires.

Going green can translate into big savings for homeowners. Some of the companies with insurance incentives include:

Farmers Insurance

The Farmers Insurance provides a green savings and inventive program for customers in 29 states. It's known as the Eco-Rebuild endorsement. This option, available for customers whose homes have suffered a total loss and have to rebuild, includes benefits such as:

  • An additional $25,000 to replace destroyed materials with green materials.
  • Reimbursement for costs associated with recycling debris and waste rather than disposing it.
  • Reimbursement for additional costs incurred if the customer's alternative energy source loses power or is destroyed.
  • Upgrading damaged property and appliances in the home to meet Energy Star requirements.

Fireman's Fund

Fireman's Fund was the first U.S. insurance company to offer green insurance to commercial properties and now offers green insurance for homeowners as well. Coverage includes:

      • Green investments, such as alternative water systems.
      • Costs associated with rebuilding a lost property as a green-certified building.
      • A 5 percent discount on homeowner's insurance to policyholders with Energy Star buildings.

See how much you could save today on your home insurance. Get your free home insurance quotes today!