German reinsurance group Hannover Re has developed an energy savings warranty insurance product for industrial enterprises in Germany.
The insurance solution, developed in cooperation with KlimaProtect, enables providers of energy efficiency solutions to guarantee the potential energy savings offered by their retrofit activities. In the event that the promised energy savings fail to materialise, the company concerned receives deficiency payments from the contractor which are backstopped by the insurance coverage. Hannover Re reinsures these energy savings warranties covered by its primary insurance clients.
The idea for the product is based on a warranty insurance solution jointly developed by Hannover Re in the US, which it has now adapted in cooperation with KlimaProtect to meet the needs of German businesses.
“With this innovative insurance product we would like to create additional incentives to invest in energy-efficient measures and reduce energy consumption in Germany,” said Ulrich Wallin, chief executive officer (CEO) of Hannover Re.
Target clients for the warranty insurance include firms that improve exterior insulation, install heating systems and combined heat and power units or optimise lighting equipment. Going forward, Hannover Re said that it expects to see further vigorous growth in investments in energy efficiency measures on the European market.
However, a London summit on the industry’s introduction of the technology cautions that testing and acceptance are still at an early stage and firms should proceed with caution.
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