CSAA Insurance Group has announced a $25 million commitment to the California WIldfire Innovation Fund, an organization that aims to decrease the severity and frequency of catastrophic wildfires by supporting economic development related to forest restoration.
The California Wildfire Innovation Fund was developed by CSAA in partnership with Blue Forest, the nonprofit group behind the Forest Resilience Bond, which deploys private capital to finance forest restoration projects. CSAA was one of the Forest Resilience Bond’s first investors.
“The California Wildlife Innovation Fund is strategically aligned with our support of the Forest Resilience Bond, which reduces risk by accelerating the pace and scale of forest management,” said Jeff Huebner, chief risk officer for CSAA. “We are confident that this new fund will deliver meaningful outcomes for our customers, our communities, and anyone who recognizes the importance of protecting California from the threat of wildfire and climate change.”
The fund, which is managed by Blue Forest Asset Management, targets emerging investment opportunities in forest restoration, wood utilization, and wildfire mitigation. It places special emphasis on industries and projects that add system capacity, create value for forest restoration byproducts, and unlock carbon offset revenue through carbon storage and sequestration, CSAA said.
“We’re excited to launch the California Wildfire Innovation Fund in partnership with CSAA because it’s specifically tailored to create strategic value for insurance company investors by aligning wildfire risk reduction outcomes with compelling financial returns,” said Zach Knight, CEO of Blue Forest. “Through local investment, we can help build the restoration economy for forest resiliency projects, create sustainable jobs, and develop the forestry infrastructure necessary to tackle the wildfire crisis.”
In addition to financial return, the fund is expected to deliver multiple environmental, economic and social benefits, including:
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“With the success of the Forest Resilience Bond, we saw firsthand the need for a new investment solution focused on adding system capacity,” Knight said. “The Blue Forest Asset Management platform fills this financing gap, and the California Wildfire Innovation Fund was purpose-built to identify and pursue investment opportunities that strengthen the overall forest restoration ecosystem.”
“We consider it our duty to explore industry innovations that will safeguard people and property by minimizing the severity of climate-induced catastrophes,” Huebner said. “Our investment in the California WIldfire Innovation Fund significantly advances our commitment to forest resiliency from wildfire while generating competitive financial returns, which is a sustainable business approach to tackling important environmental, social and economic challenges.”
Last year, California became the first state to enforce insurance discounts related to wildfires.
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