Mass timber, which includes cross laminated timber (CLT), has been gaining popularity in North America and several CLT manufacturing facilities have been built on the continent to produce the product.
Gary Kaplan, president of AXA XL's North America construction business, described CLT as a sustainable building material which speeded up construction.
“From a risk perspective, it can be challenging,” he said. “But when a broker like Arthur J Gallagher comes to us on behalf of a client, like major commercial contractor Swinerton, we knew we needed to take on the challenge to find a solution appropriate to the risk."
"Mass Timber is environmentally friendly and as a renewable resource has a smaller carbon footprint," Mr. Kaplan added.
"Addressing this insurance challenge for our clients certainly also aligns with AXA XL's Corporate Social Responsibility efforts to reduce our own carbon footprint and support those organizations who are looking to do the same."
Joe Vierling, profit centre head for AXA XL's Builders Risk business in North America, said the insurance industry had long been wary of the risks of wood construction due to combustibility.
"Fortunately, given our clients' attention to risk management and the growing availability of technology that can help monitor buildings during construction, we're confident we can successfully extend capacity to cover carefully managed mass timber construction risks."
According to Mr Vierling, he and his team will be providing coverage and capacity to experienced contractors that have successfully delivered mass timber projects, using proven materials supplied by experienced manufacturers.
The AXA XL insurance companies offer Builders Risk insurance to protect large and complex building projects against first party property damage during construction.
