Many of our clients are green entrepreneurs, working to develop a green product or service in a green economy.  It is critical that we not only listen to our client and understand the potential exposures of financial loss but to also internalize their hopes, dreams and the vision they have for their business.  I really enjoy having conversations with our green clients about all facets of their business such as product development, marketing, advertising, human resources and financing.  I not only find each encounter very interesting but in virtually every conversation I come away with information that could impact their insurance program. 

Since the inception of Green Business Insurance, Inc. I have met with, and underwritten, many different types of risks involved with alternative energy sources.  In each case I come away energized (no pun intended) by the vision, enthusiasm and promise these business show.  My hope is that I am able to educate "mainstreet" insurance company underwriters that these "green" prospects are an excellent target market. 

I recently met with a commercial property and casualty insurance prospect whose business deals with alternative energy.  The prospect is essentially a manufacturer's representitive of windmills, solar panels and other products and materials that will generate energy for homes, businesses and communities.  My new prospective client does not manufacture, install or even take possession of the property.  All products sold are manufactured in the United States.  After marketing this account to twelve different carriers, both national and regional, I was quite surprised to learn underwriters were apprehensive about underwriting the risk.  Fortunately, I was able to secure quotes that fell within their budget but this experience spoke volumes to me about the P&C industry's understanding of sustainability.    

While the primary purpose of green business practices is to protect the environment, I find that my company's green initiative positively influences employee behavior, productivity and efficiency.

As the sole stockholder of a private enterprise I realize my business has limited resources and that I need to effectively communicate this idea to my team.  As I walk through our office my eyes wander and I sometimes cringe as see waste in various forms - time, energy or tangible property.  "I may as well throw $500 out of my office window!", is my exact thought at the time.  While I could confront the offender and create a lot of negative energy among our staff (I did this a lot in my younger years), it is far more positive to communicate company efficiency and productivity via our green initiative.

During weekly staff meetings I like to address the subject of our green office habits by emphasizing the importance of recycling, turning computers off when not in use and avoid printing, when possible.  Yes I speak of the impact of the environment but my message is also translated to mean - waste takes money out of my wallet!

By implementing green practices in your office you can help the environment and your bottom-line.

Patrick G. Thompson, CPCU is President of Green Business Insurance, Inc.
greenbuildinginsurancecoverage.com

 

 

 

Constructing a green building or renovating an existing building to increase efficiency is a smart decision for commercial building owners.  Before construction begins, however, construcion materials should be researched. 

New green building materials are constantly being introduced to the market.  Often the products are so new and "high-tech" they are not UL listed or Factory Mutual approved.  In addition, green building materials may not be well tested.  Conditions surrounding a project will determine if the materials should be used considering issues such as temperature, moisture and wind patterns.  Keep in mind green building materials may not be available in certain quantities so delivery expectations should also be considered.

While under construction, quality control of your green building project should be constantly evaluated.  Contractors can somewhat unfamiliar with new, green building materials.  Before, application, communicate to each contractor the recommended installation procedures.

Pat Thompson, CPCU
Green Building Insurance Coverage

Insurance companies that offer green insurance coverage through Green Business Insurance should consider implementing a dividend plan - returning a portion of paid premium to the policyholder if the green policyholders, over-all, have low loss ratio.

Green Business Insurance Dividend Plan

• In order for Green Business Insurance to pay dividend to green policyholders, total combined green premiums must be over $2 million
• In order for Green Business Insurance to pay dividend to green policyholders, combined loss ratio for green policyholders cannot exceed 85% for all lines of green insurance business
• In order for policyholder to receive green dividend check their individual loss ratio cannot exceed 85% during the policy year
• Green policyholders will receive a dividend check of up to 5% of prior year paid premium if the total group loss ratio is below 85% and their individual loss ratio is below 85%

The figures above are not exact but the concept should be considered. 

As the United States economy evolves toward sustainability, I am convinced that climate change litigation will be a concern for businesses and risk managers. 

Below I have listed a few examples of potential liability exposures facing insureds:

Directors & Officers face considerable exposure from stockholders and outsiders who believe company leadership have not taken sufficient measures to reduce the company's carbon footprint. 

Architects & Engineers that design green buildings could be sued if the building they designed does not sufficiently reduce carbon emissions.

Contractors that construct green buildings could also be sued if the constructed building does not sufficiently reduce carbon emissions as projected.

Technology Firms hired to design energy efficient computer systems could be sued if the system is not as energy efficient as their client was lead to believe.

Insurance Agents could face errors and omissions claims if policyholders do not have proper coverage related to green liability claims.

It is in the best interest of all businesses to evaluate their exposure to potential liability claims associated with sustainability.

After twenty-years of working in the insurance industry, I can't tell you how many times insurance companies have told me "we want to insure businesses that are safety conscious, promote responsibility to employees and businesses that are growing."  For the past six months I have spent considerable time consulting with insurance companies on how to find such business-sell insurance to green businesses.

Underwriting managers and marketing managers of property and casualty insurance companies and health insurance companies are neglecting the most "careful" and potentially profitable businesses in the marketplace-green businesses.  The genuine concern that responsible businesses and green businesses demonstrate toward the environment translates very will to the insurance industry.  Strict quality control, careful employee screening and superior property maintenance are just of few of the characteristics green businesses consistently demonstrate and are characteristics insurance carriers find highly desirable.

As I meet with insurance company executives and recommend they research the green business landscape as a prespective niche for their insurance company, I get a lot of "blank-stares".  However, once the concept is understood from an insurance company underwriting perspective, there is considerable interest.  As Green Business Insurance grows, we hope to leave our mark on the insurance industry by promoting green businesses as responsible stewads of the environment deserving of lower-cost insurance.

Pat Thompson, CPCU is President of Green Business Insurance, Inc., an independent insurance agency focusing soley on insuring green businesses.  A twenty-year insurance industry veteran, Mr. Thompson has considerable experience designing insurance programs for domestic and international businesses while also consulting with insurance companies on green insurance.  Mr. Thompson can be reached at 614-562-5881 or by email pt@greenbusinessinsurance.com.

 

At Green Business Insurance, not only do we focus on offering the best insurance rates available for green businesses but we are also creating innovative green policy language.  After a claim has occurred, business owners and employees are in a highly stressful situation.  Customer and employee retention, work location, inventory and computer network repair are just a few, of many matters that need to be evaluated to get the business moving toward pre-loss productivity. 

Green Business Insurance is an industry leader in developing insurance coverage is tailored to meet the needs of a green businesses.  One example of our unique offerings is Green Consultant Coverage.  This is a one-of-a-kind policy benefit that will soon be available when approved by state insurance departments throughout the United States.  After a claim, the policyholder will receive up to ten hours of free advice from a green consultant who will recommend using the most efficient power sources and office equipment, organic building materials, recycled building materials and organizing the office in a manner that promotes a green office environment.  No other policy offers this benefit!

We look forward to continued focus on improving the insurance protection for green businesses!