Category Archives: Disaster Resilience

Hurricane Laura Update: 8/27/2020

Damage reports from Hurricane Laura are coming in. Lake Charles, La., was especially hard hit, and there are reports of a chemical leak nearby.

Laura made landfall near Cameron, La., as an “extremely dangerous” Category 4 hurricane. The National Hurricane Center (NHC) said in an early-morning bulletin that Laura had weakened to a Category 3 hurricane, with rapid weakening forecast, and the storm has since been downgraded to a Category 1 as it heads northward.

“Lake Charles experienced severe wind damage but seems not to have seen the amount of storm surge that was feared,” said Triple-I non-resident scholar and Colorado State University atmospheric scientist Dr. Philip Klotzbach.  

Despite the downgrade, the hurricane still had sustained winds of more than 100 mph. Heavy rain is predicted to be widespread across the west-central Gulf Coast, with five to 10 inches falling over a broad area, and locally up to 18 inches, leading to flash flooding.

The storm is now tracking inland across western Louisiana with damaging winds and is an inland flood risk as far north and east as Arkansas and the Ohio and Tennessee valleys. 

“The threat of tornadoes today and even tomorrow also exists as the storm recurves into the Tennessee Valley,” Klotzbach said. 

Atypical Wildfire Activity? Of Course — It’s 2020

If you need any further evidence of the anomalous nature of the year 2020, you can take a look at California’s wildfires. Two of the three largest fires in California history rage across the state, alongside about 600 others, burning more than 1.3 million acres — an area about the size of Delaware — and forcing more than 100,000 people to evacuate.

Those of us who aren’t directly affected may have become jaded enough to think, “More fires in the West. That’s normal.”

But as Janet Ruiz, Triple-I’s California-based director of strategic communications, explains, “We’ve had a significant number of large wildfires since 2015, but this year is anything but normal.”

Your first clue might be the alphabet soup of names applied to this year’s blazes: LNU, CZU, SCU. You might remember Northern California’s major wildfires in recent years — the Camp Fire, the Carr Fire, Tubbs, Ferguson — and wonder why this year’s don’t have similarly straightforward names.

According to California fire officials, it’s because the number of fires has required them to be grouped together in “complexes”:

  • The LNU Lightning Complex in the northeast Bay Area, including Sonoma, Napa, Solano, and Lake counties.
  • The CZU Lightning Complex in the western and southern Bay Area, including San Mateo and Santa Cruz counties.
  • The SCU Lightning Complex in the eastern and southeastern Bay Area, including Santa Clara, Alameda and Contra Costa counties, and neighboring San Joaquin and Stanislaus counties.

“We only group fires like that when we have a lightning siege as such,” Brice Bennet, a public information officer for the California Department of Forestry and Fire Protection (Cal Fire), told the San Francisco Chronicle.

The last major lightning siege was in 2008.

“Once the fires are grouped into a complex,” the Chronicle explains, “they’re managed so fire managers can assess all the different fires within each one and share resources across the greatest need — life being first, and property second. That’s where the prefixes come in. Those monikers are geographical locators based on Cal Fire administrative unit codes.”

Ruiz explained that many of the fires since 2015 were caused by human activity, rather than nature.

“Authorities have worked hard and invested a lot of money to mitigate those causes,” she said. “Then along comes this unpredictable, unpreventable abundance of lightning strikes.”

Fewer firefighters: Thanks, COVID-19

The daunting number of blazes coincides with a reduced availability of firefighters, courtesy of the coronavirus pandemic.

“In past seasons, a lot of help came from inmates recruited to assist in firefighting,” Ruiz said. “Many of these have been released because of COVID-19 and therefore aren’t available.”

Less warning, preparation paramount

Lightning is a universal metaphor for random ill fortune, and the chaotic causation of California’s 2020 fires has affected how authorities communicate with residents about impending threats.

“Normally you’d get warnings about approaching fires, followed, if necessary, by a mandatory evacuation order,” Ruiz said. But last week, when Ruiz was evacuated, “We didn’t get an advisory – we were just told to go.”

Wisely, she and her husband keep “to go” bags near their front door and were able to leave within 10 minutes of receiving the order.

A year characterized by a global pandemic, historic civil unrest, an “extremely active” hurricane season, a destructive derecho – not to mention the more bizarre entomological offerings of murder hornets, zombie cicadas, and invasive “jumping” earthworms – is no time to forgo caution where wildfire safety is concerned.

Ruiz reminds us that this fire season is still young, and more and worse may be in store.

Further Reading:

Safeguard Your Business From Wildfires: Allianz and Triple-I Team Up on Mitigation

Wildfires and Insurance: Learn How to Prepare Financially

Facts and Stats: Wildfire

Are You Financially Prepared for a Wildfire?

Knowing Insurance Is Part of Wildfire Preparedness

Fighting Wildfires With Innovation

Laura and Marco Set Sights on Northern Gulf Coast

Tropical storms Laura and Marco are expected to hit the northern Gulf Coast within a few days of each other. Marco was a hurricane on Sunday but has weakened considerably due to strong southwesterly wind shear. 

While Marco’s wind threat has diminished, heavy rain of three to six inches, with small areas potentially receiving 10 inches of rainfall are possible along the north-central and northeast Gulf Coast, according to the National Hurricane Center.  Storm surge of two to four feet also is possible from Morgan City, LA, to Ocean Springs, MS.  Marco is expected to make landfall later today in southeast Louisiana.

Following close behind is Tropical Storm Laura, which forecasters say may intensify to a Category 2 hurricane by the time it makes landfall along the northwestern Gulf Coast.

Residents along the Louisiana coast were urged to prepare for hurricane conditions, and Gov. John Bel Edwards called on them to begin sheltering Sunday evening.

“If you’re in duress and need help, we’re going to get to you as soon as possible,” Edwards said at the state’s Emergency Operations Center, where officials were tracking and preparing for the storms. “But as soon as possible may be longer than it normally is.”

The National Weather Service warned Sunday that the stronger Laura could bring more significant impacts across southern Louisiana because of its potential for higher winds and storm surge and because preparing for Laura will likely be complicated by lingering impacts from Marco.

Texas Gov. Greg Abbott on Sunday declared a state of disaster for 23 counties and requested assistance from the federal government. If Laura were to make landfall in Texas, it could mark the second significant disaster during the 2020 hurricane season for Texas, following Hurricane Hanna dumping more than 15 inches of rain on South Texas in late July as the region was a deadly coronavirus hotspot. The COVID-19 pandemic remains pervasive in Texas, killing at least 200 people every day for the last three weeks, and Abbott reminded the public on Sunday to adhere to mask wearing, social distancing, and other health guidelines.

South Texas cities were the first to deal with a hurricane during the coronavirus pandemic, tweaking shelter practices to have adequate distancing between evacuees and outfitting first responders with protective equipment in order to follow safe coronavirus health guidelines from the Centers for Disease Control and Prevention.

Residents are strongly encouraged to prepare for these and other storms during this “extremely active” hurricane season – particularly with the additional challenge of COVID-19.

Hurricane preparedness guidance is available from Triple-I here.

Insurance considerations

Wind-caused property damage is covered under standard homeownersrenters, and business insurance policies. Renters’ insurance covers a renter’s possessions while the landlord insures the structure.

Property damage to a home, a renter’s possessions, and a business – resulting from a flood – is generally covered under FEMA National Flood Insurance Program (NFIP) policies, if the homeowner, renter, or business has purchased one. Several private insurers also offer flood insurance.

Private-passenger vehicles damaged or destroyed by either wind or flooding are covered under the optional comprehensive portion of an auto insurance policy. Nearly 80 percent of U.S. drivers choose to purchase comprehensive coverage.

Swiss Re: A Katrina-like hurricane could cause up to $200 billion in damage today

A memorial cross for the victims of Hurricane Katrina stands in the water near the bank of the Mississippi River Gulf Outlet on August 22, 2019 in Shell Beach, Louisiana. According to researchers at the National Oceanic and Atmospheric Administration (NOAA), Louisiana’s combination of rising waters and sinking land give it one of the highest rates of relative sea level rise on the planet. (Photo by Drew Angerer/Getty Images)

Hurricane Katrina, which struck the United States in August 2005, remains the costliest insured North Atlantic hurricane on record and the most expensive natural catastrophe for the global re/insurance industry.  In 2020 dollars, according to a Swiss Re  report released today, total economic damage from Katrina totaled more than $160 billion.

An identical storm today “could easily reach” $200 billion, Swiss Re says.

To evaluate what Hurricane Katrina might look like in 2020 in terms of insured and economic losses, Swiss Re ran Katrina’s 2005 wind and surge footprint on its U.S. market portfolio using its probabilistic tropical-cyclone loss model.

“If Hurricane Katrina were to hit the U.S. in 2020 with the same wind and storm surge as 2005, but with current exposure information and updated flood protection and vulnerability assumptions, the privately insured losses in the U.S. alone could rise to $60 billion,” the report says. “This is true, despite the city (New Orleans) currently only having 80% of the population it did in 2005.”

Private insurance and the federal flood insurance program covered about $86 billion of the total loss, highlighting a protection gap largely driven by uninsured flood losses. Standard residential insurance policies exclude coverage for flood damage resulting from surface water, including storm surge caused by hurricanes; separate flood insurance policies are available through FEMA’s National Flood Insurance Program and private insurers.

“With Katrina, and even more recently with Harvey and Sandy and Florence, we’ve seen this profound protection gap where on average only one in six residences in the U.S. have a flood coverage policy,” said Marla Schwartz Pourrabbani, a Swiss Re natural catastrophe specialist and lead author of the report.

Today, a storm like Katrina would cause closer to $175 billion in damage because areas outside New Orleans, especially in other coastal states, have seen both increases in population and increased investments along the coast that add to the financial risk. Rising sea levels also contribute to the potential losses.

Swiss Re says the effects of climate change could drive total costs  higher.

“Considering that sea level in the barrier islands near New Orleans is now rising by over one inch every two years, a six-inch increase in sea level — and an event like this could happen in just over a decade,” the report says.

I.I.I. Media Tour: What You Need to Know and Do as Hurricane Season Peaks

The Insurance Information Institute (Triple-I), along with Colorado State University’s atmospheric research scientist Dr. Phil Klotzbach, will be conducting a satellite media tour on Tuesday, August 11, to talk about what may lie ahead for the remainder of the hurricane season.

Dr. Phil Klotzbach, Colorado State University

We will be talking with news organizations throughout the U.S. about the steps individuals and businesses in hurricane-prone states need to take to protect their property and possessions with the right type—and amount—of insurance.

The following subject-matter experts will be available for interviews:

  • Sean Kevelighan, CEO, Insurance Information Institute (Triple-I)
  • Dr. Phil Klotzbach, Research Scientist, Colorado State University and a Triple-I Non-Resident Scholar
  • Laura L. Favinger, Chief Administrative Officer, Triple-I
  • Mark Friedlander, Director, Corporate Communications, Triple-I

Damage caused by tropical storms and hurricanes can upend lives for months, and sometimes years. Even in the country’s most vulnerable coastal states, individuals and businesses may underestimate their risk or have insufficient insurance coverage, operating without either an evacuation or a business continuity plan.

As the peak of 2020’s already busy Atlantic hurricane season approaches, it’s time to make sure you’re ready.

Nearly 20 media outlets have signed up to participate, and the following stations will be broadcasting live interviews (times are Eastern Standard):

08-11-2020 08:35 am – 08:45 am ET: WRAZ-FOX TV Raleigh-Durham (27) “WRAL’s 8am News on Fox50” Live
08-11-2020 09:20 am – 09:30 am ET: WPBF-ABC TV West Palm Beach-Ft. Pierce (36) “WPBF 9AM NEWS” Live
08-11-2020 09:40 am – 09:50 am ET: WBRC-FOX TV Birmingham (Ann and Tusc) (44) “Good Day Alabama” Live
08-11-2020 10:20 am – 10:30 am ET: WTKR-CBS TV Norfolk-Portsmth-Newpt Nws (42) “Coast Live ” Live

If you’d like to arrange an interview with our experts, please contact MultiVu Media Relations, 800.653.5313 x3

Isaias Expected to ApproachFlorida This Weekend

Hurricane Isaias is expected to strengthen somewhat, to a strong Category 1 hurricane, as it crosses over the Bahamas Friday and Saturday. The National Hurricane Center (NHC) now forecasts Isaias will come extremely close to the east coast of Florida later this weekend. 

According to the National Weather Service (NWS), the strongest winds in Florida will be felt from Pompano Beach to Palm Bay, where there’s potential for winds from 58 mph to 73 mph. Miami-Dade and most of Broward are predicted to see winds from 39 mph to 57 mph.

The NHC recently posted hurricane watches from north of Deerfield Beach to the Volusia-Brevard County line and forecasts two to four inches of rainfall from south-central to southeastern Florida, with potential totals of six inches. There is also the potential for some storm surge, with exact levels dependent on the future track and intensity of Isaias.

Residents are strongly encouraged to prepare for Isaias and other storms during this above-average hurricane season – particularly with the additional challenge of COVID-19.

Broward County Sheriff Gregory Tony said South Floridians should “start to examine what other opportunities or options they may have to be out of South Florida.”

Florida has recently experienced a surge in COVID-19 cases. In preparation for the storm, the Florida Department of Emergency Management has closed all state-run COVID-19 testing sites.

“The more that we can do as individuals and focus on the things we can do to reduce the burden on government will be extremely helpful as the mayor, the county administrator are tackling different new challenges and trying to be innovative to the point where we’re not shutting down government completely, but at the same time, we’re not unnecessarily allowing for hazards and exposures to this virus,” Tony said.

Wind-caused property damage is covered under standard homeowners, renters, and business insurance policies. Renters’ insurance covers a renter’s possessions while the landlord insures the structure.

Property damage to a home, a renter’s possessions, and a business – resulting from a flood – is generally covered under FEMA National Flood Insurance Program (NFIP) policies, if the homeowner, renter, or business has purchased one. Several private insurers also offer flood insurance.

Private-passenger vehicles damaged or destroyed by either wind or flooding are covered under the optional comprehensive portion of an auto insurance policy. Nearly 80 percent of U.S. drivers choose to purchase comprehensive coverage.

Isaias Meets COVID-19: South Floridians Advised to Consider Evacuation

South Floridians should “start to examine what other opportunities or options they may have to be out of South Florida,” Broward County Sheriff Gregory Tony said in a virtual press conference as a broad area of low pressure looked increasingly likely to turn into Tropical Storm Isaias.

Tropical storm-force gusts could arrive in Florida as early as Friday night, but Saturday is much more likely, according to the National Weather Service (NWS) Miami.  

Tony said the biggest hurdle officials anticipate during the 2020 hurricane season is the ability to effectively maintain social distance while taking in large numbers of people at county storm shelters. Florida has recently experienced a surge in COVID-19 cases.

“The more that we can do as individuals and focus on the things we can do to reduce the burden on government will be extremely helpful as the mayor, the county administrator are tackling different new challenges and trying to be innovative to the point where we’re not shutting down government completely, but at the same time, we’re not unnecessarily allowing for hazards and exposures to this virus,” Tony said.

In preparation for the storm, the Florida Department of Emergency Management has said it will close all state-run COVID-19 testing sites at the end of business day today.

The storm knocked out power to more than 300,000 clients across Puerto Rico, according to the island’s Electric Power Authority. Minor damage was reported elsewhere in the island, where tens of thousands of people still use tarps as roofs over homes damaged by Hurricane Maria in September 2017.

Lightning Rounds: Investing in disaster and risk management technology

The Insurance Information Institute (Triple-I) yesterday hosted a webinar showcasing technology companies whose products mitigate the impact of severe weather on homeowners, businesses and communities. This is the first in a series of Lightning Rounds – fast-paced pitch panels for insurance and non-insurance investors.

The webinar is part of the Resilience Accelerator initiative, a collaboration of Triple-I, ResilientH2O Partners and The Cannon

During the Lightning Rounds, pre-vetted technology companies, equipment suppliers, integrated solution providers, and large-scale project development teams present their unique value propositions.

This Round’s focus was flood prevention. Shelly Klose, CEO of True Flood Risk described the company’s AI-driven risk management platform that provides individual property data, geolocation intelligence and risk scores related to flood risk in real-time without an on-site inspection. Tasha Nielsen Fuller, CEO of FloodFrame USA, presented a system which is installed underground around a structure, and automatically deploys in a flood, protecting the structure. Rahel Abraham, Founder and Chief Executive Officer of ClimaGuard, was inspired to invent a water-resistant wrapping for vehicles and other possessions when her own vehicle was flooded during Hurricane Harvey.

To view a recording of the webinar click on the video above.

Webinar overview

Part 1: A view from the C-Suite: Identifying the right technology and risk solutions

Brian Gaab, Strategy & Innovation, CSAA Insurance Group, a AAA Insurer

Susan Holliday, Senior Advisor, International Finance Corporation | The World Bank Group

Matthew T. Schneider, Co-CEO, Aon Risk Solutions, M&A and Transaction Solutions

Michel Leonard, PhD, CBE (Moderator), Senior Economist & Vice President, The Insurance Information Institute

Part 2: Use Cases: Bringing to market flood management solutions

Presenting Companies:

Shelly Klose, Founder and Chief Executive Officer, True Flood Risk

Tasha Nielsen Fuller, Chief Executive Officer, FloodFrame USA

Rahel Abraham, Founder and Chief Executive Officer, ClimaGuard

Panelists:

Brian Gaab, Strategy & Innovation, CSAA Insurance Group, a AAA Insurer

Susan Holliday, Senior Advisor, International Finance Corporation | The World Bank Group

Matthew T. Schneider, Co-CEO, Aon Risk Solutions, M&A and Transaction Solutions

Remington Tonar, Chief Resilience Officer and Senior Advisor, The Cannon

Richard Seline (Moderator), Managing Partner, ResilientH2O Partners

Hurricane Modeling: High-Tech MeetsLocal Insight

Sophisticated computer modeling has led to great advances in forecasting weather-related disasters and their potential human toll and economic impact. The predictive power of these models has given insurers comfort writing coverage for risks – like flood – that were once considered untouchable and enabled them to develop innovative products.  

It can be tempting to think of hurricane forecasting and modeling as being all about high-resolution images, big data, and elaborate algorithms. While these technologies are critical to developing and implementing effective models, they depend heavily on local knowledge and “boots on the ground.” 

“After an event, we quickly send engineers to survey structural damage and look for linkages to the storm’s characteristics,” said Jeff Waters, senior product manager for risk modeler RMS. “Information gathered by our people on the ground is incorporated into our reconstruction of the event to help us identify drivers of the damage and inform our models.” 

Waters recounted how, in the wake of Hurricane Maria in 2017, an RMS team arrived in Puerto Rico on October 3 – 13 days after landfall – to validate a modeled loss estimate. During the week the team spent on the island, they found that damage to insured buildings was less than expected for a storm of Maria’s magnitude. They also observed that most insured buildings featured bunker-style reinforced-concrete construction and flat concrete roofs.  

“These buildings performed very well,” Waters said. “Reinforced concrete prevents significant structural damage, and, with less drywall and tiled flooring, interior damage from water intrusion is limited. Wood and light-metal structures – which tend to be in older neighborhoods where fewer properties are insured – fared far worse.”  

Such ground-level information not only helped validate RMS’s loss estimate – it also contributes to the model’s continuous improvement. You can read a more detailed account on the RMS blog. 

Recent research illustrates how advances in geospatial technologies allow qualitative local knowledge to be incorporated into mathematical models to evaluate potential outcomes of restoration and protection projects and support plans for mitigation and recovery.  Local knowledge mapping is one such approach to marrying modern technology and the advanced analysis it facilitates to the experiences of the individuals, communities, and businesses most affected by natural disasters. 

Mangroves and Reefs: Insurance Can Help Protect Our Protectors

Hurricanes and storm-related flooding are responsible for the bulk of damage from disasters in the United States, accounting for annual economic losses of about $54 billion, according to the Congressional Budget Office (CBO).  

These losses have been on the rise, due, in large part, to increased coastal development. More, bigger homes, more valuables inside them, more cars and infrastructure – these all can contribute to bigger losses. The CBO estimates that a combination of private insurance for wind damage, federal flood insurance, and federal disaster assistance would cover about 50 percent of losses to the residential sector and 40 percent of  commercial sector losses. 

Recent research illustrates the benefits provided by mangroves, barrier islands, and coral reefs – natural features that frequently fall victim to development – in terms of limiting storm damage. In many places, mangroves are the first line of defense, their aerial roots helping to reduce erosion and dissipate storm surge. A healthy coral reef can reduce up to 97 percent of a wave’s energy before it hits the shore. Reefs — especially those that have been weakened by pollution, disease, overfishing, and ocean acidification — can be damaged by severe storms, reducing the protection they offer for coastal communities. 

In Florida, a recent study found, mangroves alone prevented $1.5 billion in direct flood damages and protected over half a million people during Hurricane Irma in 2017, reducing damages by nearly 25% in counties with mangroves. Another study found that mangroves actively prevent more than $65 billion in property damage and protect over 15 million people every year worldwide.  

A separate study quantified the global flood-prevention benefits of coral reefs at $4.3 billion.  

Such estimates invite debate, but even if these endangered systems provided a fraction of the loss prevention estimated, wouldn’t you think coastal communities and the insurance industry would be investing in protecting them? 

Well, they’re beginning to.  

The Mexican state of Quintana Roo has partnered with hotel owners, the Nature Conservancy, and the National Parks Commission to pilot a conservation strategy that involves coral reef insurance. The insurance component – a one-year parametric policy – pays out if wind speeds in excess of 100 knots hit a predefined area. Unlike traditional insurance, which pays for damage if it occurs, parametric insurance pays claims when specific conditions are met – regardless of whether damage is incurred. Without the need for claims adjustment, policyholders quickly get their benefit and can begin their recovery. In the case of the coral reef coverage, the swift payout will allow for quick damage assessments, debris removal, and initial repairs to be carried out.  

Similar approaches could be applied to protecting mangroves, commercial fish stocks that can be harmed by overfishing or habitat loss, or other intrinsically valuable assets that are hard to insure with traditional approaches.