Whilst real estate lending is becoming more "green" it is good to see that the borrowers are also being supported by the insurers. Query whether this will mean any shift in premiums downwards to support the efforts of the real estate industry in driving best practice remains to be seen.
Lloyd’s of London announced that by 2022 it will issue guidance to its market participants to derive 2% of annual premium income from innovative and sustainable insurance products. As such, we expect to see a greater level of focus from insurers on borrowers’ wider operations and their progress towards cutting carbon emissions as part of the underwriting process. We also expect to see new insurance capacity providers entering the market with environmental targets at the heart of their strategy, mirroring the influx of capital into the green financing space.
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