I grew up in rural Minnesota so I’m no stranger to snow and cold weather. I’ve also lived in Kansas, where they say if you don’t like the weather just stick around because it will change in a few hours.
Growing up and living in areas exposed to the elements imbued me with a fascination for extreme weather and its consequences. To this day I never cease to be amazed at how events play out.
Take last year, for example. Swiss Re’s sigma report on natural catastrophes and man-made disasters reveals a schizophrenic array of events that baffles the imagination. From winter’s icy blasts to the fiery eruptions of summer, 2015 had it all. Though globally it was a relatively calm year, a few events really stand out and illustrate the shape of things to come.
The mid-February winter storm in the Northeast was the biggest event in North America, causing damage across 17 states and insured losses of USD 2 billion. It was the first time in 22 years that a US winter storm was responsible for the world’s largest insured loss in a calendar year. At the time I wrote that the impact of the storm was far-reaching and couldn’t simply be defined in terms of property damage. With large population areas in the path of the storm, business interruption was significant.
Two seasons later on the other side of the country, the Western US experienced the hottest summer on record and conditions that fueled the worst wildfires in decades. The only saving grace is the fires burned in largely unpopulated areas of California, Oregon and Washington and generally spared the heavily populated areas of Los Angeles and San Diego counties.
Still, a relatively benign cat year globally from a financial loss perspective is no reason to be complacent. Too many risks are uninsured, making it impossible for too many businesses, families and communities to recover financially from a disaster. Globally, insurance covered just 40% of total catastrophe losses last year, and while that’s slightly better than the 10-year average of 32% it’s still a massive protection gap.
Inability to rebuild or to resume operations has an adverse effect on economies. Recognizing that 80% of the world’s income is generated in cities, experts have set their sights on making our cities more resilient in the face of weather volatility. As part of the 100 Resilient Cities initiative, Swiss Re partners with the Rockefeller Foundation and Veolia to provide rapid funding in the wake of a disaster, helping communities repair their infrastructure and get back on their feet faster. The program will be piloted in New Orleans and replicated in other cities.
Growing up on the Minnesota plains, this time of year we’d be saying goodbye to winter—albeit slowly—and bracing for spring’s turbulence, with thunderstorms and high winds, even tornadoes. Let’s take a few moments during the calm to consider how else we can close the gap between insured losses and economic losses. What projects are underway in your part of the world?
To view the full sigma report please click here.
Category: Climate/natural disasters: Disaster risk, Drought, Floods/storms, Resilience
Location: Kansas City, KS, United States