Thursday, December 10, 2009

Replace Damaged Property with Greener Options

Many insurance companies are introducing special Green Upgrade endorsements to their Property policies. Green is the new black. We are all looking for ways to reduce our energy consumption and take it easier on Mother Nature.

Has anyone seen the movie WALL-E? My daughter loves that movie, so it's on heavy rotation in our house. In WALL-E's version of the future, the human race has to abandon planet Earth because we overloaded the environment with our garbage. Buildings are dwarfed by skyscrapers of garbage that has been crushed & cubed by our friendly, little robot.

None of us wants to live in this WALL-E World. However, we don't exactly have the cash needed to install that green roof.

These insurance policies offer an interesting compromise. In the event of a claim, the policies will pay the additional costs to replace damaged property with environmentally-friendly equipment.

One of our carriers, Central Insurance Company, offers a Green endorsement to their Homeowner's Equipment Breakdown coverage. It will pay up to an additional $3,000 to replace damaged equipment with a greener alternative. Here are some examples:


A homeowner’s hot water heater suffers an overheating event resulting in damage to the storage tank that is beyond repair. The homeowner replaces this heater with a tank-less hot water heater to provide instantaneous hot water on demand. The green equipment breakdown coverage can be applied to this additional initial cost, creating reduced operational cost for the homeowner. Property damage paid: $1,775 (less $500 deductible) for a tank-less water heater.


A homeowner’s washer and dryer are damaged by a power surge. The repair company determined that the electrical damage was too extensive to repair the covered property. The insured was provided an estimate to replace the washer and dryer with a similar size and quality for $950, as well as an estimate to replace them with Energy Star® rated appliances for $1,480. Property damage paid: $1,480 (less $500 deductible) as equipment was upgraded to an Energy Star® rated washer and dryer.


A homeowner’s refrigerator freezer was damaged by electrical arcing. The repair company determined that the electrical damage was too extensive to repair the covered property. The insured was provided an estimate to replace the refrigerator with a similar style, size and quality for $1,100, as well as an estimate to replace them with Energy Star® rated appliances for $1,600. Property Damage paid: $1,600 (less $500 deductible) for newer Energy Star® refrigerator, plus $430 spoilage.


Central's offering is an example of new changes for Personal Homeowner policies. Green options for Commercial Buildings are sprouting as well. Stay tuned for future posts on this topic.

Does your policy offer any Green options? I'd like to know more about what else is out there.

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