Sustainable living and the future of home insurance
Friday 19 June 2020
Most of us know that climate change will have some effect on the way we live in the future. But rather than being completely overwhelmed by the enormity of the climate crisis, Allianz and UTS’s new ‘Future of Living’ report looks to simplify the challenge. Its aim is to help us understand how people will live in the future and how home insurance will have to adapt.
Allianz Insurance’s general manager of home and lifestyle, Rachael Poole tells Mozo that home insurance will change in the future and that policies will ultimately be shaped by how young Aussies revise their homes to be more green.
“We know many Australians genuinely want to learn how they can adjust their current living situation accordingly, which is fantastic. However, many simply don’t know where to start or even why it is important to invest in sustainable living,” says Poole.
Poole says that it’s important that Allianz have a view on future living trends so that it can remain a leader in insurance products that support more sustainable living solutions.
What will the future of living look like?
Led by Gen Z and Millennials, the future of living will in short be more sustainable than it is now and more in tune with the natural environment.
The report found that in the not too distant future, shared living arrangements will be more commonplace, the outside will be brought in more, reusing old materials will become more of a thing and our homes will be furnished with more preloved pieces.
According to the research, the sharing economy will grow from shared work spaces, car rentals and resources to shared, permanent living arrangements.
The traditional model of the family home will be challenged, as more homes will be designed to work with rather than against their natural surroundings. One example the report gives of this is the Daylesford Longhouse Residence and Working Farm in Victoria. The space is described as a reimagining of the agricultural shed as ‘a home in which the line separating garden and living quarters no longer exists.’
Finally, in a bid to lower the carbon footprint of the built environment, the report talks about how new materials will be reused more. This will extend to both the materials used in building and the fact that Gen Z and Millennials will continue to reject the constant need to buy new things.
How will home insurance change in the future?
With all these projected changes, one clear talking point is how home insurance will adapt to the new ways of living in the future.
Poole says that the findings from the Future of Living report would enable Allianz to adapt and evolve its insurance policies.
“When considering the future, as an insurer, this sort of report is highly valuable for our teams to identify risks such as less walls in homes, naturalised interiors or shared living spaces before they even emerge as home design trends,” Poole says.
She adds that if homes are changing, then insurance policies will have to change too. Although, it would seem that sustainability is already on some insurers’ minds, as a number of Australian insurance companies announced that they would be backing Climate KIC’s Climate Measurements Standards Initiative earlier this month.
On top of this, Allianz already has policies in place to support and encourage Australians to adopt more sustainable living practices, Poole says. One example she gives is a $5,000 incentive for water and energy efficiency equipment. This means that on top of the sum insured, customers with building cover are awarded extra money to pay for the installation of a rainwater tank, grey water recycling system, hot water heat exchange system and solar power system. This eco-incentive applies if your home is destroyed and Allianz agrees to rebuild it.
Although it should be noted that the extra $5,000 is only available when you have building cover and after the deduction of any government or council rebates you may be eligible for.
Of course, we’re a few years off from any of these new ways of living entering the mainstream. In the meantime, it’s still a good idea to make sure your current home is insured and to take time researching which insurance will suit you best. Head to Mozo’s home insurance hub to see what building and contents insurance policies are available in Australia right now.