Insurance Model for Reused Building Materials - A Scalable Framework for Circular Construction

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The project “Insurance Model for Reused Building Materials – A Scalable Framework for Circular Construction” addresses a central barrier to reuse in the construction industry: the current lack of clear insurance solutions for projects involving reclaimed components. In collaboration with partners from the insurance and construction sectors, the project aims to develop a scalable model that defines conditions under which reuse can be insured. By establishing a insurance product, applicable across different project types, the initiative supports broader adoption of reuse practices in planning and procurement. 1. Brief introduction of the ideaThe project aims to develop an insurance model specifically tailored to address the risks associated with using reused construction materials. Currently, the lack of suitable insurance and liability frameworks is a key barrier to scaling circular building practices. In collaboration with insurance providers and implementation partners from the construction industry, the goal is to create an insurance product that supports risk mitigation in the form of a validated concept or pilot-ready model. In collaboration with the partners, the project will evaluate whether a standalone policy or an add-on to existing construction insurance is the most suitable outcome.2. What challenge in the circular construction industry does your idea address?The project addresses the absence of suitable insurance and liability models that enable the safe and scalable use of reused components in construction, thus supporting the successful implementation of circular delivery models.3. Vision & Innovation The vision is to establish a viable insurance model that de-risks the use of reused materials in construction projects. The model will be co-developed with an insurance company and supported by experienced implementation partners from the construction industry. It will clarify core questions regarding liability, ownership, and applicable insurance types (e.g., building warranty, builder’s risk, third-party liability).The model will leverage insights from previous studies and practical reuse experience, particularly from partners such as Losinger Marazzi.Stakeholders across the building sector (including planners, developers, insurers, and contractors) will benefit from a solution that enables circular practices while providing legal and financial certainty. The model aims to establish reference standards that encourage additional insurance companies to integrate reused materials into their coverage, building on existing examples while creating a scalable and transferable solution for the wider construction industry.The approach bridges technical, legal, and economic gaps, establishing a systemic enabler that not only opens up new opportunities for insurers, but also provides tangible incentives for clients and planners to adopt reuse-based design as a viable standard in future construction projects. 4. How could your idea positively impact the planet, people, or economy?By enabling the insurability of reused building materials, the project removes a key barrier to circular construction. This directly reduces construction waste and embodied carbon emissions (planet), increases trust and legal certainty for project stakeholders (people), and opens up new service models for insurers and reuse-related businesses (economy). The insurance solution helps shift risk perceptions, encourages broader market adoption of reuse practices, and empowers decision-makers to choose circular options without compromising on safety or accountability.5. What assumptions or ideas do you want to test? What will be worked on during the Booster, and what is the goal to deliver at the end?The project will test three key hypotheses:(1) Reused components can be insurable under defined conditions;(2) Insurance products for reused materials can be economically viable when risks are clearly allocated;(3) Standardizing liability structures is possible across use cases.During the Booster, the project team will conduct a structured needs and risk analysis, including 2–3 co-creation sessions with insurance experts and reuse practitioners. Expert interviews and a comparative review of insurance products will support the development of a risk matrix and applicability criteria for reused components. Construction partners will help assess real-life use cases and validate operational relevance.The main deliverables include:– A draft insurance model (or product) outlining risk allocation, insurability criteria, and liability structures– A pilot project is planned in which reused materials or an entire building will be insured under the newly developed model, serving as a first practical application and proof of concept– A proposal for a pilot framework, including clearly defined roles and documentation requirements, designed to enable broad applicability beyond the pilot. 6. Has your idea been tested before?The idea has not yet been tested in the Swiss market. International examples such as Concular’s RCMI (Germany) and Cycle Up (France) have explored potential insurance approaches for reused construction materials. In Switzerland, pilot projects have obtained insurance on a case-by-case basis through individual negotiations, but no standardized product or liability framework exists. The öbu Reuse initiative has identified this gap as a major barrier to implementation. What remains to be tested is the development of a scalable and legally robust insurance model tailored to Swiss regulatory and market conditions.7. Who is in your team? The project is led by the öbu initiative “Wiederverwendung in der Bauindustrie,” a working group with long-standing expertise in circular construction. The core team includes a physicist with extensive leadership and 40 years industry experience in the metal and medical technology sectors, as well as professionals in sustainability and circular economy management with project experience in the reuse of building components since 2021. The team has already contributed to two successfully supported projects within the CBI Booster program.Implementation partners include:Industry partner: Losinger Marazzi, a construction company with hands-on reuse experience, contributing insights into feasibility, risk management, and market relevanceResearch partner: SIA Ticino, a research and institutional partner providing access to pilot projects and regional policy networksAn insurance partner is currently being identified through the initiative’s network, with the aim of actively involving them in the model development during the Booster phase8. How will the 10% third-party funding be secured? The 10% co-funding will be covered through a funding of Bundesamt für Umwelt (BAFU).

Project Idea Metadata

• Project Idea Name: Insurance Model for Reused Building Materials - A Scalable Framework for Circular Construction
• Date: 4/7/2025 8:07:01 AM
• Administrators:
  • Luna Sagasser

Project Idea Description

1. Brief introduction of the idea

The project aims to develop an insurance model specifically tailored to address the risks associated with using reused construction materials. Currently, the lack of suitable insurance and liability frameworks is a key barrier to scaling circular building practices. In collaboration with insurance providers and implementation partners from the construction industry, the goal is to create an insurance product that supports risk mitigation in the form of a validated concept or pilot-ready model. In collaboration with the partners, the project will evaluate whether a standalone policy or an add-on to existing construction insurance is the most suitable outcome.

2. What challenge in the circular construction industry does your idea address?

The project addresses the absence of suitable insurance and liability models that enable the safe and scalable use of reused components in construction, thus supporting the successful implementation of circular delivery models.

3. Vision & Innovation

The vision is to establish a viable insurance model that de-risks the use of reused materials in construction projects. The model will be co-developed with an insurance company and supported by experienced implementation partners from the construction industry. It will clarify core questions regarding liability, ownership, and applicable insurance types (e.g., building warranty, builder’s risk, third-party liability).

The model will leverage insights from previous studies and practical reuse experience, particularly from partners such as Losinger Marazzi.

Stakeholders across the building sector (including planners, developers, insurers, and contractors) will benefit from a solution that enables circular practices while providing legal and financial certainty. The model aims to establish reference standards that encourage additional insurance companies to integrate reused materials into their coverage, building on existing examples while creating a scalable and transferable solution for the wider construction industry.

The approach bridges technical, legal, and economic gaps, establishing a systemic enabler that not only opens up new opportunities for insurers, but also provides tangible incentives for clients and planners to adopt reuse-based design as a viable standard in future construction projects.

4. How could your idea positively impact the planet, people, or economy?

By enabling the insurability of reused building materials, the project removes a key barrier to circular construction. This directly reduces construction waste and embodied carbon emissions (planet), increases trust and legal certainty for project stakeholders (people), and opens up new service models for insurers and reuse-related businesses (economy). The insurance solution helps shift risk perceptions, encourages broader market adoption of reuse practices, and empowers decision-makers to choose circular options without compromising on safety or accountability.

5. What assumptions or ideas do you want to test? What will be worked on during the Booster, and what is the goal to deliver at the end?

The project will test three key hypotheses:

(1) Reused components can be insurable under defined conditions;

(2) Insurance products for reused materials can be economically viable when risks are clearly allocated;

(3) Standardizing liability structures is possible across use cases.

During the Booster, the project team will conduct a structured needs and risk analysis, including 2–3 co-creation sessions with insurance experts and reuse practitioners. Expert interviews and a comparative review of insurance products will support the development of a risk matrix and applicability criteria for reused components. Construction partners will help assess real-life use cases and validate operational relevance.

The main deliverables include:

– A draft insurance model (or product) outlining risk allocation, insurability criteria, and liability structures

– A pilot project is planned in which reused materials or an entire building will be insured under the newly developed model, serving as a first practical application and proof of concept

– A proposal for a pilot framework, including clearly defined roles and documentation requirements, designed to enable broad applicability beyond the pilot.

6. Has your idea been tested before?

The idea has not yet been tested in the Swiss market. International examples such as Concular’s RCMI (Germany) and Cycle Up (France) have explored potential insurance approaches for reused construction materials. In Switzerland, pilot projects have obtained insurance on a case-by-case basis through individual negotiations, but no standardized product or liability framework exists. The öbu Reuse initiative has identified this gap as a major barrier to implementation. What remains to be tested is the development of a scalable and legally robust insurance model tailored to Swiss regulatory and market conditions.

7. Who is in your team?

The project is led by the öbu initiative “Wiederverwendung in der Bauindustrie,” a working group with long-standing expertise in circular construction. The core team includes a physicist with extensive leadership and 40 years industry experience in the metal and medical technology sectors, as well as professionals in sustainability and circular economy management with project experience in the reuse of building components since 2021. The team has already contributed to two successfully supported projects within the CBI Booster program.

Implementation partners include:

• Industry partner: Losinger Marazzi, a construction company with hands-on reuse experience, contributing insights into feasibility, risk management, and market relevance
• Research partner: SIA Ticino, a research and institutional partner providing access to pilot projects and regional policy networks
• An insurance partner is currently being identified through the initiative’s network, with the aim of actively involving them in the model development during the Booster phase

8. How will the 10% third-party funding be secured?

The 10% co-funding will be covered through a funding of Bundesamt für Umwelt (BAFU).

The project “Insurance Model for Reused Building Materials – A Scalable Framework for Circular Construction” addresses a central barrier to reuse in the construction industry: the current lack of clear insurance solutions for projects involving reclaimed components. In collaboration with partners from the insurance and construction sectors, the project aims to develop a scalable model that defines conditions under which reuse can be insured. By establishing a insurance product, applicable across different project types, the initiative supports broader adoption of reuse practices in planning and procurement.