A bill just introduced in California could encourage more ecologically friendly insurance policy products, putting the state again at the fore of pushing, and leading, for greener public policies.
The bill, which has been titled the California Green Insurance Act of 2010, could affect a broad range of insurance products, from automobile coverage, to property/casualty policies, to workers’ compensation plans.
Insurance would seem a way to bridge over a wide range of different and varied endeavors that have a significant ecological impact, in one fell swoop. But, the legislation’s sponsor, Assemblyman Dave Jones (D-Sacramento), said only that the inspiration for the legislation came to him because he thinks a lot about insurance as chair of the Assembly’s health care committee, and because he wants to make a contribution to the environment.
The bill was introduced eight days before the California Legislature adjourns for the year. Jones said that was not done as an attempt to ram the bill through before opposition could mobilize. Rather, it was so the legislation would be on the agenda, and interested parties– including insurance companies–could begin to discuss and hone the measure.
Jones said he has had no input from anyone in the insurance industry yet.
Green insurance is not without precedent in California. Insurance Commissioner Steve Poizner has called pay-as-you-drive automobile insurance, an option being considered in the state, a “green” insurance because it would encourage less driving.
Moreover, Fireman’s Fund Insurance Co., for one, offers green replacement property insurance as standard for some of their policies. It first offered green commercial policies in 2006. It also has green homeowner policies.
Buildings, with their energy use, contribute more carbon emissions to the atmosphere than cars and there is a real push in the real estate industry to make buildings more energy efficient and less polluting, so it makes sense to offer insurance that recognizes that consciousness, said Janet Ruiz, a spokesperson for Fireman’s Fund, Novato, Calif.
“We know that it is very popular for buildings to be more energy efficient and use less water,” Ruiz said.
Jones’ proposal would, among other things:
- Require the state insurance commissioner to hold hearings and gather information contrasting the risk, costs, and claims of low-emission vehicles compared with non-low-emission vehicles.
- Require property insurance companies to offer green replacement coverage and to offer coverage for solar and wind distributed generation as part of a homeowner’s insurance policy.
- Require the insurance commissioner to hold hearings and gather information on the risk, costs, and claims associated with green buildings.
- Require the insurance commissioner to conduct hearings regarding the health impacts on workers in green buildings, and use in the information in establishing the Workers’ Compensation Claims Cost Benchmark.
- Offer state tax credits to insurance companies that invest in financial institutions that provide products and services designed to protect the environment and support renewable energy projects.
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