Perth Sunday Times
Green-Conscious Australians can now get carbon-neutral car insurance.
Australian Insurance Holdings today launched what it says is the first 100 per cent carbon-neutral motor insurance in Australia.
Local competitors Insurance Australia Group Ltd and Suncorp Metway Ltd do not have such a product, but are monitoring its impact on the market.
The Australian Insurance Holdings product is being offered by its subsidiary, ibuyeco, which was also launched by its sister company, insurer BGL Group in the UK last June, with a similar offer.
Policyholders have money added to their premium based on the amount of carbon their vehicles emit each year.
In Australia, the price of the carbon will be calculated by sustainability management firm, Greening Australia. For every kilogram of carbon produced by their cars, policyholders will pay for a kilogram of carbon to be saved using a "climate-friendly'' project somewhere else in the world identified by Greening Australia. The amount of carbon policyholders emit is calculated on the type of car they drive, its year of manufacture, make and model and kilometres clocked up each year.
Insurers will be hit hard by climate change if sea levels rise and storms get worse. While IAG does not have "green'' insurance, it gives motorists information on how to reduce their carbon footprint.
Customers of IAG subsidiary NRMA Insurance can ask the company to buy them carbon credits through the New South Wales Greenhouse Gas Abatement Scheme.
In a separate deal, NRMA Insurance in Queensland offsets a tonne of carbon emissions for every new comprehensive car insurance contract until February 2008.
Both firms would consider including carbon offset costs in car insurance premiums.
Since June ibuyeco in the UK had saved 20,000 tonnes of carbon, BGL said.