Going Green? Don’t Forget to Check Your Insurance Coverage

Increasing numbers of businesses are striving to reduce the size of their carbon footprint. While these efforts to go green save valuable resources in the long run, their initial setup can be costly.

For example, under traditional commercial insurance coverage, replacing or repairing old equipment with more environmentally friendly parts is not fully covered. Reimbursement is based on the value of the original equipment, which is typically lower than that of its green counterparts.

However, in response to these growing green needs, many insurers are now offering green endorsements that businesses can add to commercial property policies.

Green materials and equipment endorsements cover the higher cost of environmentally certified materials and equipment. It includes coverage for the difference in cost if your previous equipment was not green certified. If you must rebuild, the policy can also allow you to elevate your building to green certification status.

Green construction endorsements cover all miscellaneous costs involved with green construction, including design, engineering, certification fees, and recycling. Additionally, some insurers offer discounts for hybrid and electric cars if used for commercial purposes.

Some aspects of going green may require business owners to increase their coverages. For example, because green construction typically takes longer than traditional construction, business owners may want to extend their business interruption coverage.

They may also wish to increase overall property coverage if new environmental features are added.