Philadelphia Insurance Companies Bolsters Companies Seeking Alternative Energy Solutions
Wind, solar, and geothermal energy solutions are becoming increasingly popular, and businesses are preparing by partnering with their environmental insurance providers. The green transformation is more than just a shift in climate; it’s a societal move toward more environmentally sustainable energy sources.
“As companies invest in green transformation, they are starting to examine the alternative energy space,” stated Jamie Langes, Vice President of Environmental Underwriting for Philadelphia Insurance Companies (PHLY). “Insurance can champion this repositioning by supplying financial support needed to companies engaged in green transformation through policies and programs.”
This presents a promising growth area for environmental insurers and their clients, an area insurers are actively supporting.
A Growing Interest in Green Transformation
Companies are looking toward green and alternative energy solutions for several reasons, including sustainability and profit. Insurance companies are taking notice, with some carriers even decreasing support for traditional energy sources to boost investment opportunities in green energy.
“Carriers are actively engaged in identifying strategies to deploy their capacity, and making conscious determinations regarding coverage offerings that we have committed to allot to green transformation,” Langes shared, highlighting carrier interest.
Green energy is crucial for the future of businesses, providing a renewable energy source. As interest shifts toward solar, wind, and geothermal, financial support to sustain these endeavors grows as well.
“The more companies dive into green transformation, and the more insurers support those operations fiscally, we’re projecting this could easily set a market pace in the billions in a very short time,” Langes said.
How Insurance Supports Green Transformation
Venturing into green energy should involve an environmental underwriting team with an understanding of the green transformation. Businesses seeking alternative energy need insurance support to secure adequate liability transfer and limit rising risks. Insurance provides financial support to these companies, enabling them to operate.
Langes noted, “Insurance capacity is growing, and rate is supporting new ventures from a balance of coverage and premium.”
Insurance also provides a risk management perspective that supports start-up costs and exposures for liability. An experienced underwriting team can make the difference between sound risk management and failure.
Langes added, “Green transformation is being leveraged as one component of our environmental approach, and with [PHLY’s] expertise and experience, that approach is finding new ways to do business—including collaboration and a long-term vision, which embraces our role as a financial vehicle for progressing and assisting green transformation and technology through insurance.”
Balancing Traditional and Alternative Energy
Underwriting traditional energy sources involves historical data for decision-making. Langes explained, “The insurance marketplace has ample actuarial data to gauge pricing parameters and risk acceptance vehicles from insuring traditional sources of energy long-term. As a result, insurers understand how to write that risk explicitly to make sure they’re able to not only support the business but also have the profitability to support their insureds should there be a claims situation.”
In contrast, “Green energy and design risks don’t have that much value proposition data yet since these exposures are still relatively new in the insurance marketplace as an insurable risk.”
To fully support green alternatives, underwriters must understand both sides of the energy spectrum. This involves reviewing rates, coverage options, availability, and detailed terms and conditions to best serve green transformation companies.
“The businesses have to coexist. Existing traditional energy sourcing companies that are investing in green solar, wind or geothermal will still have their original exposures; just less over time,” Langes said. “The underwriting challenge, therefore, is that we must underwrite the two dichotomies, green transformation along with traditional, as companies transition forward.”
Environmental Underwriting Experts at Your Service
Insurance is a partnership built on an insurer’s understanding of the insured’s risk management needs. PHLY’s team is dedicated to understanding its client partners’ businesses. Companies can confidently join the green transformation knowing that PHLY’s environmental underwriting team applies this understanding.
Langes continued, “We’re proactive in our approach, more than reactive. This means that what’s next, what’s new, what our insureds’ needs are, remains at the forefront of our decision making. Investing in green transformation is a fairly new endeavor for many insurance companies, but we, at PHLY, have the advantage that we’re always willing to be engaged in the evolving conversation.”
“We are integrating green transformation options into our coverage positions, investing in these initiatives as we would for any operation,” Langes concluded.
As part of Tokio Marine Group, PHLY leverages the insurance experts within the umbrella to evaluate societal changes and community interest in green transformation, as well as what clients seek from their financial insurance partners.
PHLY has built an environmental underwriting team with vast experience in the marketplace. Langes noted, “We not only have the experience but also the expertise. Many of our underwriters come from the consulting field, so they also understand the technical aspects of sustainable energy solutions.”
This dedication enables PHLY to offer tailored and competitive coverage. Underwriters are focused on companies transitioning to alternative energy solutions and related fields.
To learn more, visit https://www.phly.com/ESdivision/es-environmental.aspx
