It's a fact: Natural catastrophes are increasing in severity and frequency. The insured damage from all natural disasters in the United States in Q1 2017 is estimated at nearly $7 billion, according Aon Benfield. Of that, about $6 billion is from severe storms. Disaster losses along the East Coast are projected to escalate in the coming years, in part because of spikes in building and property development.
With the beginning of the Atlantic Hurricane season upon us, we have an opportunity to promote community resilience by fostering greater emphasis on solutions that can save lives and prevent losses. The key to having a lasting impact is to build and grow a resilience movement.
|From Debates to Dialogues
To build a resilience movement, we need to shift the dialogue from causes to solutions.
People look at insurance as purely recovery-based. Countering this perception presents an opportunity to facilitate collaboration that will make communities more resilient when catastrophes strike. The crux of insurance's impact is in how it helps businesses, communities and individuals plan ahead. This kind of preparation helps by lowering insurance costs, reducing losses, and encouraging faster recovery and rebuilding of our cities and infrastructure.
The insurance industry's commitment to resilience spreads far beyond advanced risk modeling and reporting and astute management of capital. Insurers and industry groups help to effectuate sound policymaking by advocating for the support of forward-looking legislation — for example, the reauthorization and reform of the National Flood Insurance Program (NFIP), potentially a huge catalyst for a burgeoning resilience movement.
Effective urban planning and building design also play an important role in facilitating a greater capacity for resilience. That's why the insurance/reinsurance industry supports groups such as the Institute for Business & Home Safety (IBHS), which conducts objective, scientific research to identify and promote the most effective ways to strengthen homes, businesses and communities. The industry also collaborates with institutions such as the Risk Management and Decision Processes Center at the Wharton School, the Rockefeller Foundation's 100 Resilient Cities and the Atlantic Council's Adrienne Arsht Center for Resilience.
Setting the Agenda
Insurance can help inform discussions that set the agenda for a resilience movement. Insurers and communities are renewing partnerships that work together to mitigate risk. By doing so, we can reduce costs while rebuilding affected communities faster.
Natural catastrophes are an ever-present threat. The responsibility of safeguarding property and people is a serious matter that demands effective responses all around: Enlightened public policy, motivated public and private sector partners, and well-informed and aware citizens.
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