PERSONAL LINES
HOW RESILIENCY MEASURES ARE IMPACTING THE HOMEOWNERS MARKET by Olivia Overman, IA magazine
As catastrophe risk grows, regulators and insurers are increasingly turning to mandated resilience measures to strengthen homes and reduce claim severity.
“ These are the must-do requirements that typically emerge in high-risk geographies where exposure to extreme weather is significant and where voluntary mitigation hasn’ t been meaningful enough to reduce losses,” says Helen Simonett, vice president, property line leader at Nationwide.“ The most active discussions are in the wildfire-exposed areas, such as California, and also in some of the hurricane-prone states, like Florida.”
While the benefits of resilient residential structures are becoming evident, the cost to homeowners can be high, particularly for retrofits.
REINFORCING RESILIENCE
“ The state of Florida has been out in front of mandates,” says Chris Bacon, chief operating officer, Openly.“ All of their building codes have been redesigned, and the vast majority of new construction is being built up to really high levels of protection against hurricanes – a
lot of it focuses on the roof, windows, and window treatments.”
Other states, such as Louisiana, Mississippi and Alabama have also begun to“ dip their toes into doing similar things where they’ re providing required building code improvements and then also providing some refund availability to help entice customers,” Bacon says.
“ Because there’ s a very strong capacity constraint in these states, there are no mandates, but they do have mandatory discounts that go through once the consumers have made the upgrades to their homes,” he says.
A notable non-mandate is Alabama’ s Strengthen Homes program.“ It’ s probably one of the best examples of a non-mandate which provides grants to help homeowners retrofit their homes to meet the IBHS fortified standards,” Simonett says.“ It’ s going to require stronger roofs, decking, improved nailing patterns, sealed roof decks, all things that have been scientifically proven to reduce wind and storm damage— that’ s a really encouraging non-mandate.”
14 KANSAS INSURANCE AGENT & BROKER