Engineered timber: we're expanding our underwriting appetite

Acting on climate change is at the heart of our strategy. We’re working towards achieving Net Zero by 2040, and our ability to insure a low carbon construction sector is central to this commitment. Following the success of a recent pilot working with a handful of sustainable building projects, we’re excited to share that we’re expanding our appetite to include engineered timber in commercial property developments.

What is engineered timber?

Engineered timber, also called mass timber, cross-laminated timber (CLT) and glulam, are wood products that have been manufactured and bonded together to form a composite material, panel or building system.

Reducing the carbon footprint of the construction sector

In the UK alone, the 'built environment' contributes 40% of carbon emissions.* By working with contractors, brokers and property owners who want to build more sustainably, we aim to help the construction and real estate sectors reduce their carbon footprints. Opting for more sustainable methods of construction and using less carbon intensive materials, such as engineered timber, will support the UK to become a climate-ready large economy. We’re one of the first UK insurers to commit underwriting capability towards the development of more sustainable buildings.

In addition, our risk management strategies aim to ensure the resilience and repairability of buildings made of engineered timber, and to help safegard them from water damage and fire. Putting risk management at the centre of the design process can help to remove or mitigate these risks, while enabling a competitive and sustainable approach to insurance pricing.

Adam Winslow, Aviva CEO, UK & Ireland General Insurance, said:
“There are a growing number of developers looking to build more sustainably, both by using sustainable materials like engineered timber, and by adopting modern methods of construction. Aviva wants to embrace both: widening our underwriting appetite to insure commercial buildings using engineered timber, and using our risk management expertise to minimise associated risks.

But we need to consider the carbon footprint of a building over its lifetime: if a building is designed to be replaced in the event of a relatively minor incident well within its design life, then it cannot be considered sustainable. Modern methods of construction that focus on resilience and repairability are critical to helping developers balance sustainability commitments with the safety of building users and the communities that they inhabit.”

While we are working towards our sustainability ambitions, we acknowledge that we have relationships with businesses and existing assets that may be associated with significant emissions. Visit our sustainability page to learn more about our climate goals.

Want to know more?

Read more about our appetite for Engineered Timber and Hybrid risks

Find out more

*Royal Academy of Engineering