Category Archives: Hurricane

Catastrophes, Coastal Property, Disaster Preparedness, Disaster Resilience, Hurricane, Regulation, Risk-Based Pricing

N.Y. Natural Catastrophe Exposure Highlights
Risk-Based Pricing Benefit

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By Lewis Nibbelin, Research Writer, Triple-I

New York may be less exposed to frequent natural catastrophes than states like Florida or California, but it is far from immune to massive catastrophe losses.

A recent white paper by risk modeler Karen Clark & Co (KCC) cautions against underestimating the Empire State’s vulnerability – or that of other states not typically identified with large-scale natural disasters. A future 1-in-100-year hurricane event in New York could cost insurers more than $100 billion, KCC reported, with a 1-in-250-year event potentially costing twice as much.

“Beyond hurricanes, New York also experiences substantial impacts from both severe convective storms and winter storms, which together generate almost $1 billion in average annual property losses in the state,” KCC notes.

As state lawmakers consider strengthening requirements for prior approval of premium rate increases to rein in rising costs, KCC suggests that cost reduction strategies that account for these potential impacts would help ensure “property insurance remains both available and affordable.”

Underlying cost drivers

New York is exposed to nearly $9 trillion in potential insured losses, $6 trillion of which is concentrated along the coast. Contributing factors include property location and associated rebuilding costs, demonstrating, in part, demographic shifts placing more people in harm’s way, KCC said.

“Even if rates remain constant, premiums will rise over time to reflect the increasing cost of construction,” the report said. It added that such costs for an average single-family home have doubled over the past decade.

With trillions in loss exposure, the state faces outsized impacts, even from less intense storms. For instance, Hurricane Sandy in 2012 – despite making landfall in New Jersey as a Category 1 storm – generated almost $10 billion in insured losses in New York. Based on current exposure, insured losses in New York would exceed $13 billion, with total losses climbing to $31 billion.

A Category 3 hurricane that made landfall in the state in 1938 would produce more than $20 billion in insured losses today, KCC said. The state’s “worst-case scenario,” however, is if a similar storm hit close to Rockaway Beach in New York City, as losses in the hundreds of billions would ripple through “the most populated areas of the state.”

Sustaining market health

In testimony to the New York State Senate in November 2025, the American Property Casualty Insurance Association (APCIA) estimated that such an event “would wipe out 69 years of homeowners’ insurance return on net worth. ” APCIA noted that New York State is second only to Miami in vulnerability to a hurricane exceeding $100 billion in losses.

At the same state senate hearing, Triple-I Chief Insurance Officer Patrick Schmid testified on market adjustments insurers made in the wake of Hurricane Sandy, such as updating rates and establishing reserves for Sandy-related claims that extended beyond the year of impact.

These changes have allowed state homeowners’ insurance premiums to remain “relatively average and reasonable as a percentage of household income,” contradicting “the narrative of an affordability crisis in New York’s homeowners’ insurance market,” Schmid explained.

“In other words, the ‘profitable decade’ reflects a market that learned from a major catastrophic event and adjusted accordingly,” Schmid said. “This is how insurance markets should function.”

Importance of risk-based pricing

Insurance pricing must reflect increased risks to maintain policyholder surplus, or the funds regulators require insurers to keep on hand to pay claims. Regulatory constraints on risk-based pricing in some states have forced insurers to write fewer policies or withdraw from state markets entirely, leading to less affordable and available coverage.

Unlike its homeowners’ market, New York’s auto expenditures rank among the highest in the country, driven by repair costs as well as accident frequency and fraud, according to a Triple-I Outlook. Proposals to give New York regulators the authority to block auto premium rate changes could erode surplus and further push insurers to rethink their risk appetite in the state, which already imposes a restrictive “excess profit” law.

The role of profit in insurance pricing is not merely to reward insurers for the risks they assume. As KCC puts it, profit is “the mechanism through which insurers compensate capital providers for risk.” Rather than intervene in insurance markets, policymakers should aim to provide “a regulatory environment that allows insurers flexibility to set adequate rates.”

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Catastrophes, Disaster Preparedness, Disaster Resilience, Homeowners Insurance, Hurricane, Roof Condition, Severe Convective Storm, Tornado, Wind

Mississippi Set to Launch Roof Grant Program

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By Lewis Nibbelin, Research Writer, Triple-I

Mississippi recently adopted a program that will offer homeowners grants of up to $10,000 for roofs built to the FORTIFIED™ standard, following in the footsteps of states across the country to mitigate the rising frequency and severity of extreme weather.

Developed by the Insurance Institute for Business & Home Safety (IBHS), the FORTIFIED™ standard can help reduce high wind and hail damage through construction methods like sealing roof decks and anchoring roofs to wall framing using stronger nails. While such standards remain voluntary, many insurers in Mississippi began providing premium discounts for homes that meet the designation, prompting state lawmakers to further incentivize their construction.

The Magnolia State is only the latest to follow Alabama’s lead, which largely pioneered these incentives through its own Strengthen Alabama Homes program, financed by the insurance industry with more than $86 million in grants since 2016. Designed to enhance community resiliency while also lowering insurance rates, completed retrofits earn residents premium discounts ranging from 25 to 55 percent.

Slated to begin accepting applications later this year, Strengthen Mississippi Homes authorizes the state’s insurance department to allocate $15 million a year towards grants and gives the department flexibility in determining grant eligibility as the program rolls out. More than one thousand homes are expected to qualify each year, including in inland areas and along the coast.

Notably, the new grant program builds on the state’s preexisting hurricane-specific mitigation initiative, in part reflecting growing nationwide vulnerability to other perils. While global insured losses fell below average in the first quarter of 2026, Gallagher Re analysis shows that U.S. convective storms were among the largest loss events, including a March tornado outbreak that killed multiple Mississippi residents and caused upwards of a billion dollars in insured damages throughout the Midwestern and Eastern U.S.

Mississippi ranked fourth in the nation for tornado frequency in 2025, at 111 tornadoes, according to data from the National Weather Service. Currently, it ranks second for such activity, at 48.

Modeling what works

Research from the Alabama Department of Insurance, in collaboration with the University of Alabama Center for Insurance Information and Research, has demonstrated the success of Strengthen Alabama Homes. The study found FORTIFIED homes suffered less property damage and fewer insurance claims than homes built using other construction methods when Hurricane Sally made landfall in the state.

Programs modeled on Alabama’s have sprouted throughout the United States, including in coastal Louisiana, North Carolina, and South Carolina. Farther inland, Oklahoma just opened its program statewide after three pilot launches last year, and Kentucky unveiled its $5 million program for the first time last month. Similar efforts are underway in Minnesota after the state established a grant program in 2023, with full implementation expected during 2026. Arkansas’ program also remains under development.

Insurers have long called for boosting roof resilience within and beyond hurricane-prone regions. IBHS research estimates 70 to 90 percent of storm-related insurance claims involve roof damage, meaning roof upgrades can substantially minimize losses and improve market stability, keeping insurance affordable and available for more homeowners. In addition to making homes safer, the study revealed FORTIFIED™ homes sell for nearly 7 percent more than similar homes with non-FORTIFIED™ roofs.

Mounting demand suggests such improvements are gaining traction even beyond state grant programs. An unprecedented 20,000-plus designations were issued in 2025 alone, at a 20 percent increase over the prior year, keeping IBHS on track to reach a nationwide total of 120,000 by the end of 2026.

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CSU Projects “Somewhat Below Normal” 2026 Hurricane Season

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By Lewis Nibbelin, Research Writer, Triple-I

Colorado State University (CSU) researchers predict a “somewhat below normal” Atlantic hurricane season in their initial 2026 projections, citing the likely development of a robust El Niño event as the primary reason for their forecast of six hurricanes this year.

Led by senior research scientist and Triple-I non-resident scholar Phil Klotzbach, the CSU TC-RAMS team predicts 13 named storms and six hurricanes, two of which will become major hurricanes, or those that reach Category 3 strength or higher. A typical Atlantic season sees 14 named storms, seven hurricanes, and three major hurricanes.

The team’s forecast stems from conditions favorable for a strong El Niño, characterized by above-average ocean temperatures in the central and eastern tropical Pacific. Typical El Niño events “tend to increase winds high up in the atmosphere,” Klotzbach explained, which increases levels of vertical wind shear, or changes in wind speed and direction.

Noting “too much shear tears hurricanes apart,” Klotzbach said that “especially when those events are moderate or strong, they cause very significant impacts in Atlantic hurricane activity.”

A potential record-setting super El Niño on the horizon would suggest impacts far beyond the Atlantic, including extreme heat around the globe. Bringing drought to some regions and flooding to others, the event would help suppress Atlantic hurricane activity while boosting hurricane as well as typhoon risks in the Pacific.

But while “the odds of landfall do go down when the forecast is for below normal activity,” Klotzbach emphasized “there have been significant landfalls in seasons that were somewhat below normal.”

For comparison, the 2025 Atlantic hurricane season produced 13 named storms and five hurricanes. Among those five, four became major, including three Category 5 storms – marking only the second year on record that more than two such storms occurred in the Atlantic Basin. Though none made landfall in the U.S., the Category 5 Hurricane Melissa tied with 1980’s Hurricane Allen for the strongest Atlantic Basin landfall by wind speed on record, causing widespread damage throughout the Caribbean.

While the season runs from June 1 through Nov. 30, now is the ideal time for families and businesses to review their policies with an insurance professional to ensure they have adequate coverage. Many may be unaware they need flood coverage, which is not part of a standard homeowners, condo, renters, or commercial property insurance policy. Flood policies are offered through FEMA’S National Flood Insurance Program and dozens of private insurers.

Homeowners can also upgrade their residences to voluntary standards for wind and heavy rain resilience, as modeled by the Insurance Institute for Business & Home Safety (IBHS). Retrofitting roofs to IBHS FORTIFIED standards, for instance, has demonstrated success in reducing hurricane damage, prompting numerous state governments to begin providing premium discounts to policyholders with completed retrofits.

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Catastrophes, Corporate Social Responsibility, Disaster Resilience, ESG, Hurricane, Severe Convective Storm, Wildfire

Claims Leaders Take Charge on Climate-Resilient Rebuilding

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By Lewis Nibbelin, Research Writer, Triple-I

As communities nationwide rebuild after last year’s 23 billion-dollar weather and climate disasters, many must weigh the benefits of climate-resilient construction over the immediate financial burdens, logistical obstacles, and other constraints associated with recovery. Perceived cost of these building standards poses another challenge, underscoring a widespread awareness gap that impedes adoption.

A new report from Crawford & Company explores how facilitating resilient construction became a major focus among claims leaders across the globe, as part of a greater industry shift to center sustainability in claims decision-making. Based on interviews and survey responses from a cross-section of carrier and broker partner organizations, the report highlights the growing momentum to incentivize home upgrades due to their long-term cost savings, with such initiatives largely backed by insurers themselves.

“When we can collaborate at an industry level and converge on some best practices, we’re going to create a lot more benefit for the effort that we put in,” said Pat Van Bakel, the firm’s chief commercial and strategy officer, in a recent Executive Exchange with Triple-I CEO Sean Kevelighan. “My advice is to be practical: think about what we can do that is going to drive some impact and then build from there.”

Though differing economic, political, and legal pressures shape regional approaches to resilience, Van Bakel explained that “most organizations have referenced sustainability or resiliency in their corporate strategy,” with 70 percent of respondents identifying sustainability considerations as impactful in their adjudication and resolution process. Many mentioned integrating programs to make homes more resilient to severe weather, aligning with broader industry trends to prioritize sustainable restoration over replacement.

While house upgrades to voluntary FORTIFIED standards, for instance, remain relatively affordable, adoption skyrocketed under insurer-funded programs that offer homeowners grants to retrofit their roofs along such guidelines, with completed retrofits earning policyholders steep premium discounts. Developed by the Insurance Institute for Business & Home Safety (IBHS), the construction method has demonstrated success in reducing severe storm and hurricane damage, prompting a burgeoning number of state governments to help launch their own programs.

Beyond risk reduction, “what they’ve found in those areas is that the home values have started going up and the prices of insurance have started going down,” Kevelighan said, creating an “economic flywheel to incentivize people to take action.”

Similar efforts are underway in Dallas, Tex., Kevelighan added, as Triple-I works to establish “a property-based resiliency score” that homeowners can use to “tap into a revolving loan and grant fund that allows them to get the financial means” for needed home improvements.

Premium discounts are also attainable for California residents who meet specific standards for wildfire mitigation, many of whom are pursuing certification through the IBHS Wildfire Prepared Home program. Initiated by the state’s updated “Safer from Wildfires” regulations, the discounts offer some relief for the thousands of Los Angeles homes still awaiting reconstruction after last year’s devasting wildfires in the county.

Aerial images of disaster-struck areas “bring to life the value” of these initiatives, Van Bakel said, noting that “you can see the benefit of putting resiliency into the infrastructure when there’s no other way to explain how one structure can look relatively unscathed and one right next door to it is flattened or burned to the ground, depending on the peril.”

Crawford & Company’s report further emphasizes the claims industry’s role in helping “connect the dots” for policyholders on the resources available to them, including the accessibility of resilience funding and their code upgrade coverage. While 69 percent of respondents indicated sustainability is important to their customers, the demand for such measures has yet to fully translate to public education and coordinated industry support.

As insurers increasingly navigate these efforts, Van Bankel encourages the industry to “follow what I would describe as the demand pull, rather than trying to create demand, and I think we’ll be a lot more successful.”

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Catastrophes, Coastal Property, Disaster Preparedness, Disaster Resilience, Flood Insurance, Floods, Hurricane, Parametric, Wind

Few, High-Powered Storms Defined 2025 Hurricane Season

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By Lewis Nibbelin, Research Writer, Triple-I

Though producing no U.S. landfalls for the first time in a decade, the 2025 Atlantic hurricane season generated deadly tropical storms, above-average days of major hurricane activity, and millions in economic losses, underscoring the enduring community preparedness required against this evolving peril.

Among the five hurricanes that did form, four reached Category 3 strength or higher, including three Category 5 storms – marking only the second year on record that more than two such storms occurred in the Atlantic. A new Triple-I Issues Brief examines their impacts and how they align with emerging climate and weather trends, particularly within inland areas hit by flooding from remnants of the storms.

Flood exposure spreads inland

While not to the scale of U.S. hurricanes in 2024, the year’s tropical storms were similarly destructive, with remnant moisture from Tropical Storm Chantal contributing to $500 million in damage, Gallagher Re estimates. In many affected North Carolina counties, less than 1 percent of households were covered by the National Flood Insurance Program (NFIP), highlighting a growing flood protection gap in areas once considered low-risk.

Demographic shifts also play a crucial role in the devastation as more people move into harm’s way and build their homes bigger and more expensive than before. While various flood-prone areas along the coasts lost more residents than they gained in 2024 – for the first time since 2019 – it is critical to remind home and business owners about rising flood risks throughout the country and the importance of staying protected.

Stronger, wetter weather

Warming oceans also fuel “rapid intensification,” or an increase in maximum sustained winds by at least 35 mph in a 24-hour period. Since 1980, over 80 percent of landfalling U.S. hurricanes – altogether costing at least $5 billion in damages – underwent rapid intensification at some point during their lifecycle, according to a 2025 American Geophysical Union (AGU) study.

Describing rapid intensification events as “a pronounced increasing trend,” AGU study coauthor Dr. Phil Klotzbach – a senior research scientist in the Department of Atmospheric Science at Colorado State University and Triple-I non-resident scholar – said such storms “tend to weaken at a slower rate as they move inland,” compounding challenges for residents who “aren’t necessarily as prepared as they should be.”

Hurricane Melissa – 2025’s strongest and deadliest storm – showcased the toll from this mounting intensity. Claiming more than 100 lives across the Caribbean, Melissa rapidly intensified before hitting Jamaica as a Category 5 hurricane, becoming one of the fastest-intensifying Atlantic storms ever recorded and the most powerful hurricane to make landfall in the country’s history.

Cutting-edge analytics

As advances in computing power and data collection have improved traditional tools in recent years, forecasters and insurers have built up their arsenal to combat the unpredictability of climate and weather risks. For instance, barometric pressure – found both more accurate and easier to gauge than the wind speeds traditionally used to predict storm damage – served as the primary trigger for a  $150 million parametric policy for Jamaica which paid out in full after Hurricane Melissa.

“Displaying the kind of predictive power that can help insurers price risk and mitigate costly claims, these technologies can inform conversations at all levels to encourage investment in resilience,” the brief states.

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Catastrophes, Disaster Preparedness, Disaster Resilience, Homeowners Insurance, Hurricane, Severe Convective Storm, Tornado, Wind

Severe Winter Weather Ravages U.S. Communities

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By Lewis Nibbelin, Research Writer, Triple-I

Millions of Americans remain on alert for a severe weather outbreak across the country after devastating atmospheric rivers, tornadoes, and winter storms raged at the close of 2025, causing multiple deaths and significant property damage from coast to coast.

Southern California saw its wettest Christmas Eve and Day ever recorded, with more than 17 inches of rainfall in one area of Ventura County and 10 inches in parts of the San Gabriel Mountains in Los Angeles County. Downing trees and power lines, the heavy rains triggered flash flooding and mudflows that hit hundreds of homes, prompting road closures and power outages throughout the state.

Another unusual weather system spawned 13 tornadoes across the Great Lakes in late December, with six in Central Illinois alone, damaging numerous homes. Prior to last year, only five December tornadoes had been recorded in that forecast area, the last of which occurred in 2021. Frigid cold conditions followed the storm as a bomb cyclone – part of the same system that drenched California – swept from the Midwest to the East Coast.

Defined as a rapidly intensifying non-tropical storm in which pressure drops by at least 24 millibars over a 24-hour period, the bomb cyclone generated blizzard conditions resulting in power outages for more than 300,000 customers and a massive Interstate pile-up involving over 50 cars and multiple semi-trucks in Detroit, Mich. Several feet of snow buried Upstate New York, with the hardest-hit areas in the Lake Ontario snowbelt.

As conditions begin tapering off on the West Coast, the first cross-country storm of 2026 is expected to bring torrential rain and snow in the South and much of the Midwest later this week. Threats of flash flooding as well as hail, tornadoes, and damaging winds loom across both regions, with heavy rains possible in the Northeast.

As always, Triple-I urges residents to stay informed, be prepared, and follow the instructions of local authorities. Checking insurance coverage is critical to such preparation, especially as atmospheric rivers, severe convective storms, and inland flooding become increasingly common. Many noncoastal communities impacted by recent flood events lack sufficient flood protection, and Californians grappling with claims from the storms may also be unaware they need separate flood policies for flooding and mudflow.

Affordability, Disaster Preparedness, Disaster Resilience, Homeowners Insurance, Hurricane, Insurers and the Economy, Roof Condition, Severe Convective Storm, Tornado, Wind

Storm-Resistant Roof Efforts Gain Ground

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By Lewis Nibbelin, Research Writer, Triple-I

Severe convective storms cost insurers an estimated $46 billion in the first three quarters of 2025, Gallagher Re has reported, marking the third straight year of U.S. claims from these events through September exceeding $40 billion. Total losses from these storms – which include tornadoes, hail, straight-line winds, and drenching thunderstorms – reflect growing impacts from inland flooding and, in particular, the vulnerability of roofs to damage from these storms.

Approximately 70 to 90 percent of total insured residential catastrophic losses arise from roof-related damage, according to Insurance Institute for Business & Home Safety (IBHS) estimates. Though poorly maintained roofs contribute to this finding, outdated building codes exacerbate the risk, leading insurance industry leaders to advocate for widespread adoption of FORTIFIED roof standards.

Developed by IBHS, FORTIFIED standards can reduce severe weather damage in new or retrofitted homes through construction methods like sealing roof decks and anchoring roofs to wall framing using stronger nails. While such standards remain voluntary, Louisiana has modelled the proactive approach needed to facilitate adoption with the recent expansion of its Louisiana Fortify Homes Program, which began offering homeowners thousand-dollar grants to retrofit their houses along these guidelines in 2023, incentivizing roughly 40 percent of the now 10,000 FORTIFIED roofs in the state.

“FORTIFIED roofs are the long-term solution for affordable insurance in South Louisiana,” said state insurance commissioner Tim Temple, noting that his office aims to implement bigger and more standardized insurance discounts for FORTIFIED homeowners to reinforce the state’s already improved insurance rates.

An emerging trend

Though Louisiana became the “fastest-growing state” to adopt FORTIFIED standards, Alabama pioneered incentivizing them through its own Strengthen Alabama Homes program, financed by the insurance industry with more than $86 million in grants since 2016. Designed to enhance community resiliency while also lowering insurance rates, completed retrofits qualify residents for premium discounts ranging from 25 to 55 percent.

A May 2025 study from the Alabama Department of Insurance, in collaboration with the University of Alabama Center for Insurance Information and Research, showcases the program’s success, highlighting that FORTIFIED homes suffered less property damage and fewer insurance claims than homes built using other construction methods when Hurricane Sally made landfall in the state.

“The Center’s Hurricane Sally report doesn’t just quantify the effectiveness of the FORTIFIED program, it clearly demonstrates that homes can be built to survive storms, making them eminently more insurable,” said IBHS CEO Roy Wright. “This report should be a clarion call to communities across the country, urging them to implement Alabama’s multipronged approach to promoting disaster mitigation.”

Insurers answered the call in Oklahoma, North Carolina, and South Carolina, all of which boast similar programs backed by the insurance sector and accompanying premium reductions. Mississippi nearly joined their ranks before state funding for the grant program was suspended earlier this year, though insurance discounts remain available. States such as Florida, Georgia, and Minnesota also offer comprehensive insurance discounts for FORTIFIED properties, with the latter poised to fully replicate a grant program in response to mounting hailstorms.

Addressing cost concerns

While 75 percent of homeowners express willingness to invest in weather-resistant features, only 18 percent have reinforced or replaced their roofs with those materials, a recent Nationwide survey reveals. Grants help lower the cost of entry to FORTIFIED roofs for many homeowners, but it is worth noting the relative affordability of such upgrades, which can cost as little as $500 for a 2,000 sq. ft. home.

Describing the benefits of FORTIFIED standards as “measurable and increasingly essential,” Nationwide Property & Casualty president and COO Mark Berven emphasized the crucial role insurance agents play in raising consumer awareness of these risk reductions and their broad accessibility.

“Our industry needs to remind homeowners they have control in the face of severe weather events,” Berven wrote. “By investing in resilience, they can take an active role in protecting their homes, their valuables and their memories – giving them the peace of mind they’re looking for.”

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Catastrophes, Disaster Preparedness, Disaster Resilience, Hurricane, Parametric, Risk Management

Jamaica Payout Spotlights Potential of Parametric

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By Lewis Nibbelin, Research Writer, Triple-I

Jamaica will receive a $150 million payout following devastation from Hurricane Melissa from its parametric catastrophe policy. Though one of the largest such payouts in recent years, the loss “had very little impact” on investors in the bonds backing the policy.

Investors in insurance-linked securities (ILS) “understand that these risks are part of what they cover,” said Jean-Louis Monnier, head of ILS Alternative Capital Partners at Swiss Re.

Among the strongest Atlantic hurricanes ever recorded, Hurricane Melissa became the most powerful cyclone to make landfall in the island’s history, causing an estimated $6 billion to $7 billion in damages and at least 75 deaths across the Caribbean. With a minimum central pressure of 892 millibars, the storm met the parametric thresholds for a full payout. The policy was backed by a bond issued in 2024 by the World Bank through its International Bank for Reconstruction and Development (IBRD) and structured by Aon Securities and Swiss Re Capital Markets.

Unlike traditional indemnity insurance, parametric insurance covers risks without sending adjusters to evaluate post-catastrophe damage. Rather than paying for damages incurred, policies pay out if certain conditions are met – for example, if wind speeds or rainfall measurements meet an established threshold. Speed of payment and reduced administration costs can ease the burden on insurers while expediting recovery for policyholders.

Determining appropriate parametric triggers is no easy task. Just a year earlier, the same policy did not pay out after air pressure levels narrowly missed the predefined minimum during Hurricane Beryl, despite widespread destruction. The ensuing backlash generated greater public and industry scrutiny over parametric coverage, including an intergovernmental “examination” into the ILS market broadly.

Monnier explained that this specific bond was designed to respond to larger events like Melissa, as part of the country’s extensive risk management strategy that encompasses many layers of protection. Parametric coverage from Skyline Partners and Munich Re, for instance, offered a partial payout after Beryl, as did the Caribbean Catastrophe Risk Insurance Facility Segregated Portfolio Company, which issued its largest single payout in history at $70.8 million after Melissa.

In a press release on the payout, World Bank vice president and treasurer Jorge Familiar emphasized the “proactive approach” of Jamaica’s disaster risk management, noting it could “serve as a model for countries facing similar threats and seeking to strengthen their financial resilience to natural disasters.”

Estimated to reach $34.4 billion by 2033, the global parametric insurance market is growing at a rapid pace, driven by increasingly severe climate and weather-related risks. Yet many industry leaders identify parametric structures as less comprehensive – and therefore not a substitute for – traditional indemnity risk transfers. By design, parametric insurance correlates to measurable events rather than actual damages, leading to an innate basis risk when the two do not perfectly align.

Whereas indemnity coverage is “generally preferable,” parametric structures can “complement other forms of insurance” and are particularly beneficial for sovereigns, which tend to lack the granular data needed to inform underwriting and pricing of indemnity catastrophe bonds, according to Monnier.

“Many countries use both instruments, and they can be very complementary,” Monnier concluded. “There is a large global protection gap, and Swiss Re advocates for reducing that gap, whether through traditional reinsurance or by structuring capital-market solutions.”

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Resilience Investment Payoffs Outpace Future Costs More Than 30 Times

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By Lewis Nibbelin, Contributing Writer, Triple-I

Every dollar invested in disaster resilience today can save communities up to $33 in avoided economic costs, according to new research from the U.S. Chamber of Commerce, Allstate, and the U.S. Chamber of Commerce Foundation.

Building on their 2024 finding that such investments save $13 in benefits, the report detailed the burgeoning toll of increasingly frequent and severe natural catastrophes across the United States, underscoring a need for stronger collective action to mitigate climate risk.

Invest Now, Save Later

After experiencing the fifth consecutive year of 18 or more billion-dollar disasters in 2024, the United States further drove the second costliest half-year ever for global insured losses from natural catastrophes in 2025 with January’s devastating wildfires in Southern California. Though reflecting a troubling “new normal,” the report demonstrates how resilience funding can help stabilize local economies and protect lives and jobs, regardless of the scale or type of disaster.

Modeling scenarios for five disaster types – hurricanes, tornadoes, wildfires, droughts, and floods – the study revealed that high resilience investments may cut GDP losses by billions, with reduced funding leading to significantly higher long-term costs across all scenarios.

For hurricane-prone areas, which can grapple with lasting disruptions to housing, education, and other basic infrastructure, the study noted that higher investment could prevent the loss of $13.2 billion and more than 70,000 jobs.

Emphasizing the “smart, cost-saving” efficacy of disaster mitigation, the report concluded that “preparedness is not just a safety measure – it’s a local economic development strategy.”

“Preparedness is as much about plans as it is people,” added Rich Loconte, senior vice president and deputy general counsel for government and industry relations at Allstate. “It’s supporting a local nonprofit to retain its employees and keeps its doors open after a disaster, working with civic leaders to develop recovery plans that minimize rebuilding costs, and educating community members on proactive investments that help better weather storms.”

Risk Reduction in Practice

Beyond identifying the broad impact of disaster preparedness, the report also provides actionable insights for local leaders who aim to boost community resilience but are unsure where or how to start. Recommendations for disaster preparation include:

  • Risk-Informed Design: Adopt and enforce hazard-resistant building codes, such as those that meet the Insurance Institute for Business & Home Safety’s FORTIFIED standards. Update zoning and land use planning according to the latest risk data.
  • Data-Based Decisions: Improve access to risk data to inform, track, and assess the success of disaster mitigation efforts.
  • Dedicated Resilience Funding:Create a local fund for disaster mitigation to ensure consistent investment and expedite post-disaster recovery.
  • Public Engagement: Launch risk awareness campaigns to facilitate individual and organized participation in preparedness and raise insurance take-up rates.
  • Stakeholder Partnerships: Coordinate cross-sector and multi-jurisdictional resilience strategies to maximize benefits.

A survey released in tandem with the report shows that most resilience stakeholders – encompassing emergency managers, community planners, government officials, and other risk experts –  believe public-private collaboration needs improvement, with more than half of respondents highlighting insufficient resource allocation and unclear decision-making processes as leading causes for poor coordination.

While most indicated state and local governments must play a major role in disaster preparedness, response, and recovery, 58 percent of respondents additionally underscored the federal government as crucial at every phase, particularly for financial assistance. As numerous community resilience projects hang in limbo following the Trump Administration’s cancellation of $882 million in federal grants, it is imperative for all beneficiaries of disaster resilience to help develop sensible solutions for predicting and preventing losses.

“As the cost and economic toll of disasters continue to increase, leaders at all levels of government should know that investments in infrastructure resilience will go a long way in protecting and preparing local communities,” said Marty Durbin, senior vice president of policy at the U.S. Chamber of Commerce. “Resilience investments reduce costs and speed up recovery. The faster a community bounces back, the faster jobs and economic growth return.”

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ClimateTech Connect NYC: You Just Had to Be There

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I wrapped up my first-ever Climate Week NYC last week at ClimateTech Connect. After their two-day April event in Washington, D.C., I could hardly miss this special half-day update when it was so close to home.

Fifty-plus attendees crammed a room near Grand Central Station, and I immediately spotted familiar faces and had the opportunity to meet with a mix of industry veterans and relative newbies spanning all insurance disciplines, from underwriting and claims to the cutting edge of modeling and artificial intelligence. Top insurance thought leaders and influencers were there to speak on climate-related issues of pressing interest to my industry and everyone it serves. The panel themes and the panelist themselves made it clear from the start that a blog post was not going to do the event justice.

The first panel – Pioneers Shaping the Future of Climate Resilience – was moderated by Francis Bouchard, managing director for climate at Marsh McLennan, whose bona fides include senior positions with Zurich Insurance and the Reinsurance Association of America. Francis moderated a no-holds-barred panel of young insurance leaders: Angela Grant at Palomar, Michael Gulla of Adaptive Insurance, and Valkyrie Holmes of Faura. The energy and expertise of these panelists left me feeling that the industry – in the face of myriad challenges – is being put into good hands.

The next discussion was moderated by Jerry Theodorou, a director at the R Street Institute whose professional background includes roles at Conning, AIG, and Chubb. It featured Dan Kaniewski, managing director and U.S. public sector lead for Marsh McLennan and a former FEMA deputy administrator, and Raghuveer Vinukollu, head of climate insights and advisory for Munich Re. The depth and timeliness of these three experts’ insights made for an engaging and thought-provoking session.

The third panel was both engaging and accessible – a bit surprising to me, given that it consisted entirely of PhDs. Steve Weinstein, CEO of Mangrove Property Insurance led a discussion among Joanna Syroka of Fermat Capital Management, Catherine Ansell of JPMorgan Chase, and M. Cameron Rencurrel at Mercury Insurance on not only “Why Science Needs to Be in the Boardroom,” but HOW young scientists can find their way there and decide IF that’s where they want to be.

Between these panels were presentations from representatives of several insurtechs who shared their data-driven solutions focused on understanding and addressing climate-related panels. All this in a period of about three hours (not including the networking reception afterward). Despite all the information shared, the event did not feel at all rushed.

If you weren’t able to make it and are feeling a bit left out, don’t fret! ClimateTech Connect 2026 will be held in Washington, D.C., on April 8 and 9, 2026.