27 Sep 2017 - 10:00 CET

Contributing to sustainability as insurer

Innovations in sustainability

NN Group helps people secure their financial futures. We are guided by our values of care, clear, commit in the work we do every day, but also in how we tackle topical issues, such as climate change. ‘Care’ means that we respect one another and the world in which we live. Our aim is to ensure that our activities do not have a negative impact on people, animals or the environment.

Although product developments are often driven by customer need, they can also make a positive contribution to sustainability at the same time. Nationale-Nederlanden’s sustainable products include pay-as-you-drive car insurance, such as Fairzekering and VOOROP©. Under these policies, drivers who drive with due care for the environment and the road earn an additional discount on their insurance premium at the end of the year.

Delta Lloyd also has a number of products that contribute to sustainability. In this blog post, we look at two examples of these products: insuring wind farms and the fire prevention scan for the SME sector.

Insuring wind farms

Delta Lloyd insured its first Dutch wind farm in 2008. ‘At the time, we were looking at growth markets in which we could support our customers and in which we could put our bold approach and expertise to good use. This is how we arrived at wind farms. We are now the largest Dutch insurer of offshore wind farms’, says Willem Schrijver, sector manager at the Offshore Wind team. ‘Insuring offshore wind farms is a complex process that requires specialist knowledge and customisation. We insure both the construction and the wind turbine itself, once it has been delivered and starts operating. We offer all-risk coverage: everything is insured unless we stipulate an exclusion. At many other non-life insurers, the opposite is the case.’

Delta Lloyd’s insurance product range makes an indirect contribution to sustainability. ‘Last year, 2.2 million Dutch households received some of their electricity from wind energy. This led to a substantial reduction in greenhouse gases. In partnership with KPMG, DL calculated the social value of this to be approximately €15 million.

‘This market is growing rapidly. Over the next few years, around €15 to €20 billion will be invested in wind energy every year. So there are opportunities for us,’ says Willem. ‘Coal, oil and gas supplies will run out at some point. And using them is bad for the environment anyway. We need to draw more and more from alternative energy sources, such as wind energy.’

Preventing fire damage from electricity

In 2012, Delta Lloyd introduced another innovation – ElektraGarant. This independent inspection method reduces the chance of fire in electrical installations in the SME sector. ‘Lots of fire insurance policies focus on preventing and limiting personal injury. With ElektraGarant, the focus is on preventing fire damage from electricity’, says Richard Ophof, team leader of the Inspection and Advice team at Delta Lloyd’s Non-life commercial lines. ‘Since the introduction of ElektraGarant, we have conducted around 1,600 inspections and prevented various large fires and damage.’

‘A large fire has a significant impact on people, animals and the environment’, adds Jordy Otten, senior risk expert. ‘Think about the toxic substances (often asbestos) that are released during a fire, and that have to be cleared up afterwards. And the water used to extinguish the fire has to be cleaned up thoroughly. In addition, there is the work that has to be undertaken to get the company back on its feet: lorries to remove the waste or to deliver new construction materials. Or the CO2 emissions from factories that make the building materials. In short, the environmental impact of a fire is often enormous.’
This specific non-life market is developing rapidly. We will shortly be releasing a standard that can also be used by other insurance companies. This boosts support for a product like this. The standard is due to be operational for the inspection market from 1 January 2018, which is why Delta Lloyd is busy training fire inspectors. ‘Our inspections call for a substantially different attitude toward electrical installations’, says Jordy. ‘For example, inspectors need to know more about how materials burn. It would be great if the entire insurance sector contributed more to fire damage caused by electrical problems, and if it also made a larger contribution to sustainability in this area, too.’