After a year of record droughts followed by a year of record flooding, cooperation could be key.
In the aftermath of the flooding that was experienced last year throughout many regions of the United States and Canada, the insurance industry found itself facing what could only be defined as a public relations nightmare.
Residents of these hard hit zones have faced huge rebuilding costs and banks found themselves in binds.
Banks in the areas that were struck by the most flooding, last year, found themselves holding mortgages for properties that were suddenly little more than useless. That said, a great deal of the damage that occurred last year was considered to be uninsurable because the nature of the water was from overland flooding. That is a hazard that the insurance industry defines separately and that is not covered in standard business and homeowners policies.
The insurance industry is now looking for cooperation in the future in the face of climate change.
A good example of this trend occurred when Barbara Turley-McIntyre spoke in Vancouver, Canada during the Livable Cities Forum. Turley-McIntyre is the Co-operators insurance company’s head of sustainability and citizenship. She expressed that it is time for a collaborative effort on both analysis of risks associated with climate change and on the mitigation of the risks connected with them.
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Turley-McIntyre stated that “We need to be able to understand what the risks are so we can do a cost-benefit analysis and as a society put our dollars where they’re going to protect your homes and communities.” This would require coming up with more up to date and – more importantly – accurate flood maps for both urban and rural areas, and to harden infrastructure and homes against weather damage in preparation for disasters that are now likely to be coming to North America.
She also pointed out that it will mean that it will be important for the insurance industry, governments, builders, and even private owners to place a far greater focus on the prevention of the type of damage that is going to become increasingly common as a result of climate change.