HSB Engineering Insurance launches unique asset performance product for renewable energy market
Specialist engineering and construction insurer HSB Engineering Insurance (HSB), part of Munich Re, has launched an Energy Efficiency insurance product.
The policy, which is believed to be the first of its kind, has been developed to meet the needs of organisations investing in energy saving technology and the energy service companies working with them.
With energy prices at an all time high and likely to increase further with time, energy costs are becoming an ever increasing percentage of property owners‘ and occupiers‘ expenses. Whilst energy production from renewable sources is a popular solution, it is much cheaper to save a kW of energy than it is to produce one.
Paul Cullum, Product Development Manager said: “With around 40% of all the energy we consume coming from buildings, there is a major opportunity to cut both emissions and costs by installing energy saving initiatives, such as LED lighting, thermal window films and more efficient boilers, into commercial properties”.
The introduction of the Energy Act in 2011 has also increased the pressure on commercial property owners to ensure that their buildings are energy efficient. However, funding for energy efficiency projects has been slow to materialise despite significant increase in demand. Banks have been cautious with lending as loans are secured against the future cost savings of energy conservation initiatives.
Paul continues: “Energy efficiency projects bring with them a need to protect the assets installed, revenues they generate and the potential savings they produce. At HSB Engineering Insurance, we saw a gap in the market for a product which could provide the right amount of insurance cover to protect such energy efficiency projects”.
HSB’s energy efficiency insurance product is a new innovation which is available for periods of up to five years and provides cover for material damage (including equipment breakdown) of the installed systems, business interruption (protecting against loss of revenue in the event of equipment failure), and asset performance insurance covering a shortfall in energy savings. The product offers a number of significant benefits to those receiving, delivering and funding energy savings, including removal of technical risk for lenders.
With strong technical expertise and experience in underwriting energy risks, the launch of the energy efficiency product is part of HSB’s continued strategy and focus on growth in the energy sector.