RESORT SOURCES Page 49
Sep / Oct , 2024 | TimeSharing Today
Mother Nature blows more than just wind :
A breakdown of weather and climate risks across the U . S .
By Matt Stauffer , Senior Risk Advisor , and Terry Ford , Senior Vice President of Gregory & Appel
Fact : Mother Nature ’ s wrath is not confined to a single form . Instead , it appears in numerous ways , each with devastating impacts on properties across the United States . The data from 2024 underscores the variety and intensity of weather and climate disasters that have plagued the nation . This article explores how different parts of the U . S . face distinct risks and provides best practices for property management companies , resorts , timeshares , board members , onsite general managers , and maintenance teams to mitigate the damage caused by these disasters .
Over the past several decades , the United States has faced a relentless run of severe weather and climate disasters , each leaving a profound impact on both lives and the economy . From 1980 to the present , the nation has experienced 391 major events , averaging 8.7 per year . The financial toll has been staggering , with costs reaching approximately $ 2,759.7 billion , or $ 61.3 billion annually . Tragically , these events have also claimed 16,456 lives , averaging 366 deaths per year .
Recent years have seen a marked increase in both the frequency and severity of these disasters . From 2021 to 2023 , there were 66 significant events , with an average of 22 per year — almost triple the long-term average . The financial impact during this period was $ 441.3 billion , translating to an astounding $ 147.1 billion
per year . This surge in catastrophic events also led to a higher death toll , with 1,690 fatalities , averaging 563 deaths annually .
These statistics highlight the escalating risks and impacts associated with severe weather and climate events . As these disasters become more frequent and severe , it is crucial for property management companies , resorts , timeshares , board members , and onsite teams to adopt strong risk management strategies to protect lives and mitigate financial losses .
Where are we today and where could we be tomorrow ?
Current trends in 2024
As we progress through the first and second quarters of 2024 , the insurance market has shown positive trends . Many have welcomed flat renewals , and some have even experienced premium reductions . This promising development offers a sense of relief and optimism after years of escalating insurance costs driven by frequent and severe weather events .
The influence of Mother Nature
However , while these trends are encouraging , it is crucial to remain watchful and prepared for the unpredictable forces of Mother Nature . Historically , active wind seasons have had significant impacts on insurance rates . Major events such as hurricanes , tornadoes , and other severe weather phenomena have the potential to drive up rates , reversing the current favorable trends .
Historical impact on property insurance pricing
Weather and climate disasters have historically led to significant changes in property insurance pricing . For example :
• Hurricane Katrina ( 2005 ): Caused widespread devastation in New Orleans , leading to a massive increase in property insurance premiums and stricter underwriting standards .
• California Wildfires ( 2017-2018 ): Resulted in billions of dollars in damages , prompting insurance companies to raise rates and , in some cases , refuse to renew policies in high-risk areas .
• Midwest Floods ( 2019 ): Led to higher premiums and increased demand for flood insurance in affected regions .
From 2020 to 2023 , several significant events further influenced property insurance pricing :
• 2020 Atlantic Hurricane Season : The record-breaking hurricane season saw 30 named storms , including 13 hurricanes , which caused extensive damage along the Gulf Coast and the East Coast . Insurers responded with higher premiums and more restrictive terms for coastal properties .
• California Wildfires ( 2020 ): One of the worst wildfire seasons on record , with millions of acres burned and thousands of structures destroyed . This led to dramatic increases in insurance premiums and reduced availability of coverage in wildfire-prone areas .
• Texas Winter Storm ( February 2021 ): A severe winter storm caused widespread power outages and extensive property damage due to burst pipes . The event led to increased insurance claims and higher premiums for homeowners and businesses .
• Hurricane Ida ( 2021 ): A major hurricane that caused significant damage
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