Last October, Fireman's Fund Insurance Co. made waves in the green building market when it announced that it would begin to offer discounted property insurance rates for commercial buildings that are certified through the U.S. Green Building Council's LEED program or the Green Building Initiative's Green Globes rating system.
As part of the program, the Novato, Calif.-based insurer said it would offer 5% discounts for green buildings. And, in the event of a total loss for such an insured property, the company said it would pay to rebuild the structure to LEED or Green Globes standards.
As expected, the real estate market has responded positively to the insurer's gracious offer, and in just seven months, the first round of discounted policies are being written.
The Tower Companies, Bethesda, Md., is one of the first owner/developers to realize discounted insurance rates as a result of going green. Early last month, the company inked a contract with Fireman's Fund that will result in a 5% reduction in premiums for three of its green-rated office properties: the Tower Building in Rockville, Md.; Millennium Building in Washington, D.C.; and the Blair Towns apartment building in Silver Spring, Md.
Steve Bushnell, product director with the Fireman's Fund, said green building properties like the Tower Building and Blair Towns are attractive to insurers because there's “less risk in a building that is constructed with products and systems so state-of-the-art that they lower operating costs, increase resale [appraisal] values, create a healthier work environment, and provide an opportunity for greater worker productivity.”
In addition to its discounted-rate program, Fireman's Fund offers green policies for existing buildings. It's Green-Gard Property Upgrade plan, for instance, pays the full cost to rebuild non-green properties using sustainable materials and technologies in the event of a loss.
For more on green insurance, visit: www.firemansfund.com/servlet/dcms?c=business&rkey=437