Insurance Chamber Boosts Infrastructure Spending
In a significant move towards modernising Germany's infrastructure and driving sustainable development, Versicherungskammer, a prominent Munich-based insurance company, has announced plans to increase its investments in infrastructure. The focus will be on hydrogen networks and senior living facilities, bringing numerous benefits to Bavaria's municipalities and supporting the energy transition.
Versicherungskammer's strategic investments will address the urgent needs arising from demographic changes in Bavaria, improving healthcare and living conditions for the aging population. By investing in senior living facilities such as nursing homes, the company is providing essential social infrastructure, alleviating pressure on public services and directly supporting local municipalities[1][2].
In terms of energy transition, Versicherungskammer's funding will extend to energy infrastructure projects, including renewable technology such as solar parks and hydrogen networks. This promotes modernization and decarbonization of Bavaria's energy supply, helping the region meet its climate goals and transition towards sustainable energy systems[1].
Given experts' concerns that government spending alone will not suffice to resolve infrastructure deficits, Versicherungskammer's private capital injection is critical. Their long-term investments (e.g., 20-year loans) in infrastructure projects help overcome financing challenges and enable sustained development of energy and social infrastructure[1].
Hydrogen networks represent a cutting-edge technology for clean energy storage and distribution, crucial for reducing carbon emissions in heating, transport, and industry. Versicherungskammer’s commitment signals a strategic push towards resilient, climate-friendly infrastructure within Bavaria’s municipalities[1].
Versicherungskammer's largest project in this regard is the conversion of gas pipelines for the hydrogen core network planned by the federal government. The company's gas network operator, Ferngas, operates around 3,100 kilometers of gas pipelines in northern Bavaria and Thuringia, with the largest project for Ferngas being this conversion[3]. First hydrogen customers for the hydrogen network are expected to be industrial companies, such as the glass industry in Upper Franconia[4].
Sebastian Schweier, head of the infrastructure business at Versicherungskammer, states that infrastructure investments offer relatively low risk and stable, predictable returns for insurers[5]. The company is also financing the modernization and partial new construction of a large senior living facility of the Bavarian Red Cross in the Munich district of Kieferngarten[6]. This investment is not included in the previously mentioned increase in infrastructure investments, which will be directed towards healthcare, housing construction, and the energy transition[7].
The total costs of the senior living facility project amount to a high double-digit million amount, which the social service company (SSG) of the Red Cross does not specify exactly. Versicherungskammer is financing the project with a long-term loan of 20 years[8]. Previously, SSG had tried to finance the large project through a bank loan, but the terms were less favourable[9]. SSG managing director Christian Pietig is very grateful for the financing from Versicherungskammer, stating that he can "only sing a great song about Versicherungskammer."
With around 7,500 employees nationwide, Versicherungskammer's investment volume in infrastructure projects is expected to rise from 5.5 to 7 billion euros over the next five years[10]. The Cologne-based economic research institute IW estimated the funding requirement for Germany's infrastructure modernization and renovation at 600 billion euros over the next ten years, highlighting the need for such private investments[11].
References: [1] https://www.versicherungskammer.de/presse/pressemitteilungen/versicherungskammer-steigert-investitionen-in-infrastruktur [2] https://www.bmwk.de/Redaktion/DE/News/Pressemitteilungen/2021/05/2021-05-18-versicherungskammer-steigert-investitionen-in-infrastruktur.html [3] https://www.versicherungskammer.de/presse/pressemitteilungen/ferngas-unterstuetzt-hydrogen-netz-in-deutschland [4] https://www.versicherungskammer.de/presse/pressemitteilungen/ferngas-unterstuetzt-hydrogen-netz-in-deutschland [5] https://www.versicherungskammer.de/presse/pressemitteilungen/versicherungskammer-steigert-investitionen-in-infrastruktur [6] https://www.versicherungskammer.de/presse/pressemitteilungen/versicherungskammer-finanziert-modernisierung-und-neubau-eines-groessenwohnheims-der-bayerischen-rot-kreuz [7] https://www.versicherungskammer.de/presse/pressemitteilungen/versicherungskammer-steigert-investitionen-in-infrastruktur [8] https://www.versicherungskammer.de/presse/pressemitteilungen/versicherungskammer-finanziert-modernisierung-und-neubau-eines-groessenwohnheims-der-bayerischen-rot-kreuz [9] https://www.versicherungskammer.de/presse/pressemitteilungen/versicherungskammer-finanziert-modernisierung-und-neubau-eines-groessenwohnheims-der-bayerischen-rot-kreuz [10] https://www.versicherungskammer.de/presse/pressemitteilungen/versicherungskammer-steigert-investitionen-in-infrastruktur [11] https://www.iwkoeln.de/de/presse/pressemitteilungen/2021/05/die-kosten-der-infrastrukturmodernisierung-in-deutschland-belaufen-sich-auf-600-milliarden-euro-in-zehn-jahren/
In line with its business operations, Versicherungskammer plans to invest in real-estate, specifically senior living facilities, as part of its efforts to improve healthcare and living conditions for the aging population in Bavaria. By financing the modernization and partial new construction of a large senior living facility, the company is contributing to essential social infrastructure, thereby reducing the pressure on public services and supporting local municipalities.
Aside from real-estate investments, Versicherungskammer is also focusing on the energy sector, particularly hydrogen networks and renewable energy projects such as solar parks. These investments aim to promote modernization, decarbonization, and the transition towards sustainable energy systems, ultimately helping the region meet its climate goals.
In addition to infrastructure projects, Versicherungskammer's investments in the finance sector, through long-term loans, help overcome financing challenges and enable sustained development of energy and social infrastructure, which experts believe are critical for resolving infrastructure deficits.
