ESG Policy

Velocity Risk’s vision is to provide best-in-class specialty property insurance for catastrophe-prone areas. We use our appetite for uncommon risk, solutions-focused underwriting, and outstanding claims management to create greater opportunity for all. We believe in the value of relationships, speed, transparency and being in it for the long haul.

Since the launch of our business in 2015, Velocity Risk has embodied many of the principles set forth by ESG governing bodies. In 2022 we implemented a formal policy to share our ongoing commitment to sustainability in the property insurance marketplace.

Our ESG commitments:

• Environmental – We are committed to doing our part in protecting the environment in the cities where we operate and the communities where we offer insurance. One focus area is to reduce our carbon footprint through the support of organizations and methodologies that aid in mitigating the severity of natural disasters, including hurricanes, wildfires, floods, and severe convective storms.
• Social – We focus on providing the best work environment for our employees. We provide competitive salaries, premium-paid health benefits, and additional perks. We invest in and provide a volunteer reward program and encourage employee involvement. We have a robust DEI program that promotes, nurtures, and sustains a diverse, equitable and inclusive organization through commitment, transparency, and consistent actions.
• Governance – Our ESG policies stem from a leadership team that values the importance of sustainable markets and investing. We are committed to responsible growth and building strong audit, compliance, and internal controls resources to ensure accountability within the organization, high ethical standards and adherence with the laws and regulations that govern our operating territory.

We believe that insurance plays an important and essential role in society and, as an industry, supports ESG. Insurance is a vital asset for all individuals and business owners to not only help pay for covered losses, but also aids in managing cash flow uncertainty, allowing for a more efficient use of resources, promotes risk control and reduces the financial burden on society. The industry can further advance the goals of ESG by underwriting and selecting the types of risk that promote a sustainable market.

Our ESG policy is formalized through the application of relevant United Nations’ Sustainable Development Goals (SDGs) and Principles of the United Nations Environment Program Finance Initiative Principles for Sustainable Insurance (UNEP FI PSI). We believe that all 17 SDGs are important and have chosen to focus on four that align strategically with our values and goals. We further agree that all four UNEP FI PSI principles are the building blocks for any group in the insurance arena.

Below is a high-level overview of the four United Nations SDG Goals and four Principles we commit to support with our ESG policy:

• United Nations’ Sustainable Development Goals (SDGs)
  • SDG 8 – Decent work and economic growth
  • SDG 9 – Industry, innovation, and infrastructure
  • SDG 11 – Sustainable cities and communities
  • SDG 13 – Climate action
• Principles of the United Nations Environment Program Finance Initiative Principles for Sustainable Insurance (UNEP FI PSI)
  • Principle 1: We will embed in our decision-making ESG issues relevant to our insurance business.
  • Principle 2: We will work together with our clients and business partners to raise awareness of ESG issues, manage risk and develop solutions.
  • Principle 3: We will work together with governments, regulators, and other key stakeholders to promote widespread action across society on ESG issues.
  • Principle 4: We will demonstrate accountability and transparency in regularly disclosing publicly our progress in implementing the Principles.

Velocity Risk’s ESG policy focuses on five overarching areas that support the four SDGs and four PSIs listed above: Underwriting & Operations, Technology, Employee Engagement, Community Engagement and Climate. The policy outlined below provides additional detail and transparency on initiatives already in place and those on the horizon for future implantation.

1. Strengthen underwriting & operations initiatives and actions (SDG 8, SDG 11, PSI 1-4)
   1. Commitment to agents & brokers
      1. Continue to build strong relationships with key brokers to encourage identification of desired products/territories and improving the selection of desirable risks.
      2. Share our ESG commitment with brokers, support opportunities that allow them to participate in ESG, and solicit input for goals and initiatives to support each other.
   2. Commitment to customers (policyholders)
      1. Professional and fair customer treatment for market participants.
      2. Design and development customer-focused products that balance with our commitment to capital providers.
      3. Provide best-in-class, fair and ethical handling of claims.
   3. Commitment to investors i. Effective management and continuous monitoring of products, underwriting guidelines, pricing, and diversification to ensure positive growth with acceptable risk. ii. Develop and refine a strategic “View of Risk” to employ superior modeling, incorporating climate change, the impact of insurance in the marketplace, changes in behavior (social inflation), changes in building codes and changes in economic impact. 1. Manage and price our portfolio against extreme events to protect capital. 2. Incorporate future climate change predictions to consider alternate views of risk in our pricing. 3. Incorporate stress and scenario testing. 4. Investigate model miss opportunities. iii. Strong compliance and risk management of exposures and assets. iv. Provide thought leadership to the market on the impact of climate change in property insurance. v. Support the growth of property insurance clients that has a positive impact on climate change and help identify those ideal risks for our capital providers. vi. Invest in weather science and climate focused risk portfolios in partnership with capital providers.
   4. Support laws and regulations that encourage smarter building for catastrophic risks i. Partner with Subject Matter Experts such as NGOs and universities in combatting climate change and support research in smarter building. ii. Engage in opportunities that improve expertise and knowledge on resiliency. iii. Promote and endorse certified builders who offer better building options and materials.
2. Encourage innovative technological advancements (SDG 9, PSI 1-4)
   1. Continue to evolve the mobile app to support greener behavior.
   2. Our updated Policy Administration System is set up to automatically email policy documents versus printing, unless proof of mail is required.
   3. Innovation has been a key value, and we continue to encourage innovation, creating space and time for all ideas and viewpoints.
   4. We embrace the entrepreneurial spirit at Velocity and encourage employees to be creative and make bold suggestions for technological advancements that improve operations.
3. Promote a strong and dynamic employee engagement program that focuses on building a positive culture and employee well-being (SDG 8, PSI 1-4)
   1. Attract, develop, and retain knowledgeable and diverse individuals who continue to build the organization through passion and innovation.
      1. Build a robust Learning & Development program through company-offered inperson, on-line learning, and recorded webinars. Courses include insurancebased training, leadership & coaching and other soft and hard soft skills courses.
      2. Offer tuition reimbursement programs to support learning outside of Velocity.
      3. Encourage participation in team building and cultural events.
      4. Monitor employee engagement and satisfaction through regular surveys. Velocity ranked in the top 100 of Best Places to Work in Insurance for the past two years and continuously scores well above average in semi-annual eNPS surveys.
   2. Monitor and evolve a robust Diversity, Equity, and Inclusion (DEI) policy that promotes, nurtures and sustains a positive organization through commitment, transparency, and consistent actions.
      1. Foster a connected and inclusive culture.
      2. Build and maintain a multicultural workforce.
      3. Leverage Diversity and Inclusion for business results and disruption in the industry.
      4. Support and participate in external initiatives.
      5. Nurture and promote from the Top-Down.
      6. Create an environment of education and dialogue.
   3. Support employee volunteer and social program passions with matching grants and rewards for volunteer hours.
4. Support community engagement programs that focus on helping families and businesses recover from and avoid disasters through strategic NGO partnerships (SDG 11, SDG 13, PSI 1-4)
   1. Sponsor and partner with the Red Cross which supports post disaster assistance and recovery; provides case worker support to help underserved communities receive government funding with a sense of urgency.
   2. Build resilient communities through support of NGOs that build and rebuild homes and businesses that can withstand catastrophic environments.
   3. Support charities that promote strong relationships with brokers.
   4. Partner with organizations and universities that research and rebuild to reduce longterm effects of coastal deterioration and the impacts of hurricanes.
5. Advocate climate action throughout our operating territory (SDG 13, PSI 1-4)
   1. Building operations – install motion detection lighting, low energy lighting, encourage recycling and use of refillable water bottles versus plastic.
   2. Reduce energy use.
      1. Limit employee travel and encourage video conferences.
      2. Permit employees to work from home 2-3 days per week to help reduce the use of fossil fuels, traffic, and pollution.
      3. Allow for full-time remote employees with limited to no travel.
   3. Promote recycling and make it easy for employees to participate, including upcycling/recycling technical hardware.
   4. Partner with vendors who support ESG initiatives.
   5. Encourage use of alternate modes of transportation, including carpooling, bike-to-work, and train transportation.
   6. Offer Commuter Benefits, allowing employees to set aside pre-tax dollars to offset commuter expenses, such as train, van pool, etc.