Although weather related coverage has always remained a top priority in the insurance industry, recent surges in extreme weather events in the past few years has both companies and consumers looking for ways to relieve the damage it has caused and mitigate risk in the future.
The importance of weather preparedness is more crucial than ever as we head into another season of potential weather threats ranging from tornados to flooding, and in this blog post we will discuss various ways you can navigate the increasing risks associated with these weather-related disasters.
Understanding the Current Landscape
Major weather events have hit the United States over the past few years, but with 28 severe disasters in 2023 alone that resulted in a total of $108 billion in insured losses, consumers are bracing for the likelihood of a continued increase in premium cost. It is safe to say that with the current hard market coupled with the financial tolls of various weather events, the likelihood of premiums leveling in the second half of 2024 is slim to none, but with understanding the current landscape comes the ability for both companies and consumers to recognize future risk and take action to mitigate it.
Recognizing & Preparing for the Inherent Risks
While we cannot always prevent the potential damages that evolve from the threat of weather-related disasters, being prepared for the inherent risk can help aid in the amount of damage caused and the cost of it. Remaining continuously up-to-date on the weather trends in your surrounding area is a great way to not only be aware of potential threats, but can also be a valuable asset when it comes to preparing ahead of time for weather-related disasters. Investing in home improvements aimed towards weather resilience can significantly mitigate potential risks, from replacing an old roof to clearing brush and vegetation around your property to trimming overhanging trees are all proactive measures no matter how big or small that can make all the difference when it comes to weather-related preparation. Although these home improvements may initially seem like an unnecessary sunk cost, it is worth investing in the strength of your home and being ahead of potential future damages rather than waiting until the damage is already done.
Advancements in Forecasting
With continuously steady increases in costs on the weather-related side of the insurance industry, insureds are looking for ways to better manage premium increases and make adjustments based on the current state of the industry as a whole. Advancements in forecasting technology is a potential drastic measure that could aid in the management of high premiums, with providing insurers the ability to better anticipate and prepare for upcoming weather-related events, make more informed and proactive decisions, and adjust premium costs accordingly.
Anticipating Future Trends
Looking ahead to the second half of 2024, experts predict an active hurricane season and a relatively relaxed winter, with some regions facing a warmer and more wet winter, in turn potentially hindering wildfires as the seasons change heading into 2025. However, predictions are just that – predictions. It is still important for both insurers and insureds to be current with the weather trends amidst their area, and be prepared for potential weather threats in the future. By anticipating and actively preparing for potential weather trends, communities can better allocate resources and implement targeted measures to limit the total costs of damages.
In conclusion, as extreme weather events continue to increase, proactive weather preparedness is crucial for both insurers and consumers as we head into each new season. Understanding current risks, investing in safety precautions, and remaining informed on current and future weather trends are just a few of the ways you can remain prepared for whatever may come your way, and by taking proactive steps communities have the ability to limit the impact of future disasters as a whole.