Category Archives: Disaster Preparedness

Wildfire evacuation: What to take?

Two wildfires in California are spreading today (Oct. 27), fanned by high winds overnight, forcing tens of thousands to evacuate.

If you are forced to evacuate, here is a list of what to take, culled from a III article on evacuation planning:

  • Prescriptions and other medicines
  • First aid kit
  • Bottled water
  • Flashlight, battery-powered radio and extra batteries
  • Clothing and bedding (sleeping bags, pillows)
  • Special equipment for infants or elderly or disabled family members
  • “Comfort items,” such as special toys for children
  • Computer hard drive and laptop
  • Cherished photographs
  • Pet food and other items for pets (litter boxes, leashes)

From the same article, here is a list of key documents:

  • Prescriptions
  • Birth and marriage certificates
  • Passports
  • Drivers license or personal identification
  • Social Security cards
  • Insurance policies — homeowners, auto, life and any others
  • Recent tax returns
  • Employment information
  • Wills and deeds
  • Stocks, bonds and other negotiable certificates
  • Financial information such as bank, savings and retirement account numbers and recent tax returns
  • Home inventory

Unfortunately, though, if you are told to evacuate it will be too late to search the house for all this stuff. When authorities tell you to leave you must leave immediately. The fire could be on you in moments.

University of Pennsylvania PennApps XX Hackathon Recap

By Brent Carris, Research Assistant, Insurance Information Institute

Left to right: Brett Lingle, Zoë Linder-Baptie, James Ballot and Brent Carris

The Wharton Risk Center  and the Insurance Information Institute  co-sponsored the second annual Hack-for-Resilience at PennApps XX, the nation’s oldest and largest student-run college hackathon. Presentations were given by Carolyn Kousky and Brett Lingle of the Wharton Risk Center School; and the I.I.I.’s James Ballot.

From September 6 – 8, 18 student teams used software and hardware technologies to “hack”—conceive and build new apps and devices—ways to combat the risks posed by natural disasters, such as hurricanes, wildfires, and floods. The students also vied to create either a product or service that provided insurance in a customer-friendly manner, a category generally known as Insurtech.

A panel of judges from the I.I.I. and the University of Pennsylvania’s Wharton Risk Management and Decision Processes Center selected the winners.

First place in the Insurtech category was Wildfire Protect– a parametric wildfire insurance product designed to provide immediate payouts to insureds that experience property damage from wildfire.

Second place was a tie between Prophet Profit and Navig8. Prophet Profit is an app designed to help households save money by allocating funds in all sectors of the stock market. The Navig8 team created an app to assist the visually impaired communicate during a disaster.

First place in the resilience category was awarded to a hack called Phoenix. This team created an autonomous drone which detects and extinguishes fires.

You can see all other entries and winners here.

Hurricane Dorian Update: September 4, 2019

As of early afternoon on September 4 Hurricane Dorian was approximately 100 miles off the east coast of Florida. The National Hurricane Center reported that Hurricane Dorian would likely move slowly up the Florida coast to Georgia and the Carolinas. While the storm’s intensity has declined since it struck the Bahamas as a Category 5 hurricane, Dorian is now classified as a Category 2 hurricane with sustained winds of 105 mph.

Federal emergency declarations are in effect for Florida, Georgia, South Carolina and North Carolina, and the governor of Virginia also declared a state of emergency. Dorian is expected to maintain its current intensity for the next few days, and forecasters said that those in Northeast Florida to the Carolinas should be on alert for the possibility of destructive winds and flooding from heavy rains or storm surges.

Dr. Phil Klotzbach, a meteorologist at Colorado State University and Insurance Information Institute non-resident scholar, is providing regular updates on Dorian via Twitter. He said that the storm has now generated the ninth-most accumulated cyclone energy by an Atlantic hurricane named during August in the satellite era (since 1966).

In a Fox Business interview, Michael Barry, senior vice president and head of media relations and public affairs at the Insurance Information Institute, said,“The industry is very well capitalized and has the financial wherewithal to pay whatever claims comes its way. Of course, right now, we’re looking at the priority of making sure everybody’s customers are safe and sound.”

An Artemis blog post said that even if Dorian remains just offshore, some sources expect a low-single digit billions market loss from the hurricane, just from wind and surge damage along its track. That figure would rise with every mile closer to shore the eye of Hurricane Dorian comes.. Any wobble west onto shore or a full landfall could raise the potential insurance, reinsurance and insurance-linked securities (ILS) market impact significantly.

Recovery from Dorian in the Bahamas and other islands of the Caribbean that were impacted is expected to be slow because most of the damage caused by the storm is not covered by insurance. In a Wall Street Journal article, Steve Bowen, a meteorologist and head of catastrophe insights at Aon plc, said that commercial businesses have the highest levels of insurance penetration in the Bahamas, while many individuals lack coverage.

Jonny Urwin, an analyst with UBS Group AG, said it estimates that insured damage in the Bahamas could be between $500 million and $1 billion. For the storm overall, UBS projects that the total insured losses from Dorian could be between $5 billion and $10 billion, basing its estimate on a comparison with Hurricane Matthew, which followed a similar path in 2016.

 

I.I.I. satellite media tour: Peak hurricane season is upon us

 

By Lynne McChristian, I.I.I. Media Spokesperson and Non-resident Scholar 

 

 

The Insurance Information Institute, along with Colorado State University’s atmospheric research scientist Dr. Phil Klotzbach, will be conducting a satellite media tour on Tuesday, August 13 in Miami to talk about what may lie ahead for the remainder of the hurricane season. Nearly 20 media outlets have signed up to participate. We will be talking with news organizations throughout the U.S. about the rising frequency and severity of natural disasters and about what you can do to understand your risks and be ready to face them – both physically and financially.

Hurricane Season ebbs and flows. And, our collective attention spans mostly ebb. Granted, it’s hard to remain engaged with an event that lasts half a year. From June 1 to November 30, you hear the “Get Ready” message from multiple sources, and the human tendency to wait until a storm threat is on the doorstep makes preparedness more frenetic than necessary. Being hurricane ready is a smart goal, and now is an excellent time to put hurricane preparedness on the front burner. Peak hurricane season has arrived.

Mid-August through the end of October historically is when most hurricanes form. Remember HIM? Hurricanes Harvey, Irma and Maria made landfall between mid-August and the end of September in 2017. Two Category 4 storms and one Category 5 occurred in a matter of weeks in a season predicted to be slightly above average. Last year’s Hurricane Michael hit in late October. While this year’s latest prediction is for a “near-average season,” hurricane researchers will tell you that it only takes one hurricane making landfall near you to break the law of averages.

Frankly, natural disasters do not ebb and flow; there is no rhythmic pattern to them. Forecasting science is constantly improving, and that means we have a better idea of where hurricanes may be heading. But estimating intensity remains a challenge. You can’t “go with the flow.” Rather, be ready for whatever the wind brings.

The following stations will be broadcasting live interviews (times are Eastern Standard):

8:10 AM: Norfolk, VA, Radio 47  WXGM-FM
8:20 AM: Minneapolis, MN, Radio 15  KWLM-AM
8:40 AM: Raleigh, NC, TV 25 WRAZ FOX
9:10 AM: Albuquerque, NM, Radio 47 KDAZ-FM
9:15 AM: Myrtle Beach, NC, TV 95 WPBF ABC
9:45 AM: Dallas, TX, Radio 5 KKVI-AM/FM
10:25 AM: Norfolk, VA, TV 44 WTKR CBS
12:00 PM: San Diego, CA, Radio 29 KOGO-AM
12:10 PM: Los Angeles, CA, Radio 2 KMET- AM
12:40 PM: St. Louis, MO, TV 21 KTVI FO

These stations are taping segments and should air them over the next few days:

Austin, TX,  TV 40 KEYE CBS
Birmingham, AL,  TV WBRC FOX
Charleston, SC, TV 94  WCIV ABC
Chattanooga, TN, TV 83  WRCB NBC
Chicago, IL, Radio 3  WSRB-FM
Columbus, OH, Radio 34  WSNY-AM
Fort Myers, FL, TV 55  WFTX FOX
Jacksonville, FL, WTLV NBC
Mobile-Pensacola, AL, TV 58  WPMI NBC
Myrtle Beach, SC, TV 95 WPDE ABC
Roanoke, VA, TV 67  WFXR FOX
Roanoke, VA, TV 68  WSET ABC
Savannah, GA, TV 93  WSAV NBC
San Antonio, TX, TV 31  WOAI NBC
Seattle, WA, Radio 12  KORE-FM
Tampa, FL, TV 11 WTSP CBS

The roster of stations is subject to change. If you’re in one of the cities listed, please tune in!

 

IBHS CEO Impact Report: Do hail Impacted Rated shingles measure up?

By Roy Wright, President & CEO, Insurance Institute for Business & Home Safety

High-performing impact-resistant shingles can prevent avoidable damage caused by hail attacking roofs. Consumers should have confidence that products labeled as “impact resistant” live up to their expectations. This is the predicate for the Insurance Institute for Business and Home Safety’s (IBHS) groundbreaking work to improve roof performance against hail.

One month ago, IBHS reached an institutional milestone by releasing the IBHS Hail Impact Test Protocol for Asphalt Shingles—a new test method that uses best-available science for predicating performance of asphalt shingles when exposed to hailstorms. This is the first performance scorecard rating of eight asphalt shingle products labeled as impact resistant. By bringing together years of work in the field and in the lab, IBHS continues to be a leader in the hail research space.

IBHS’s new test standard combines the results of lab and field work that advanced industry understanding of hailstone mass, strength, and kinetic energy. Applying those findings allows us to manufacture hailstones in our lab and mimic the way natural hail attacks a roof. We assess damage from the top side of the shingle – the same way a claims adjuster would – and use artificial intelligence along with experts to evaluate the performance range.

 

Hail Cannon Testing. Photo courtesy of IBHS

Yet this milestone is just the beginning. The IBHS Hail Impact Performance program is poised to drive change and innovation across industries for years to come.

With the performance of eight products now rated and released, three new products are already at the IBHS Research Center in Richburg, South Carolina awaiting testing at the specific request of the relevant product manufacturers. These new arrivals demonstrate our commitment to ongoing testing of new products brought to the market. In addition, we are committed to retest products every two years, ensuring performance scorecards remain up to date and offering manufacturers the chance to improve product offerings based on our results.

Exclusively for the member-companies supporting the IBHS mission, we have provided a data set that expands on what is publicly available and provides greater quantitative insights and relative consumer price comparisons. We answered questions live during a Hail Impact Standard Question and Answer webinar for the IBHS Members as we strive to help put this data to work for the insurance industry.

Roofing manufacturers have actively engaged with our research team throughout the development and release processes and continue to be engaged. Some have been excited to share the results while others look forward to the next round of testing. Each manufacturer has been on our research center campus observing testing, asking questions, and striving to put their product at the top. Since the release last month, we have already had manufacturers back at the research center talking with our researchers and continuing to push for improvement.

IBHS research is inspiring conversations to drive shingle performance forward, and that will pay dividends to the Members of IBHS, to the insurance industry, and to consumers. These conversations, initiated by the performance data, are only possible with the commitment IBHS, and IBHS Members, have made to resiliency. And these very same conversations are stimulating awareness of impact-resistant shingle performance in order to improve shingles and to inform consumers of their options.

Through this new work, we are showing the insurance industry and consumers which products live up to those expectations of resilience.

 

 

California Earthquakes: How Modern Building Codes Are Making Safer, More Resilient Communities

By Sean M. Kevelighan, CEO, The Insurance Information Institute

 

 

The earthquakes that hit southern California on July 4 and 5 gave us all reason to reflect on a natural disaster that infrequently makes headlines here in the U.S.  A major seismic event occurring near several population centers is the sort of thing that many fear—but it’s also something insurers study constantly to make sure quake-impacted affected areas can recover and rebuild.

Earthquakes and other natural disasters are facts of life. The International Code Council (ICC) helps to create resilience through modern building codes that enable households and communities to rebound faster and more completely after an earthquake.

The ICC reports:

 “On the morning of July 4, a 6.4 magnitude earthquake rattled through Southern California, with another 7.1 magnitude quake striking the region the following evening.

“The damage resulting from these events could have been significant. Thanks to the modern, up-to-date building codes in California – based on the International Codes (I-Codes) – the Searles Valley Earthquake resulted in no loss of life and minimal structural damage. The I-Codes are keeping us safe, and this event reminds us of the importance of adopting and effectively implementing current model building codes as a key defense against natural disasters. Building codes save lives.

“According to structural engineers working with the Earthquake Engineering Research Institute, the homes and buildings experiencing the most severe damage date back to the 1930s, ’40s and ’50s. Modern buildings built using model codes experienced damage that was largely limited to nonstructural elements or contents.”

We encourage you to read the entire article to learn more about the essential role of building codes in creating a “resilience culture” to make our communities safer and more productive.

Have a disaster plan for your small business

Owning a small business has many rewards, like freedom, independence and the chance to financially benefit from your own hard work.  But there are also major challenges, like long hours, hungry competitors, and cash-flow problems.

One of the challenges that lands squarely on the shoulders of the small business owner is risk management. Whereas larger firms have the funds to hire specialists whose sole concern is identifying and preparing for threats to the business, Arthur the accountant and Mia the mover must take on that role themselves.

Natural disasters are a type of risk that can strike a business at any time. Luckily for Arthur and Mia, business insurance often comes with loss prevention expertise offered by many insurance carriers to their clients. An agent or broker can create a disaster and recovery plan customized for any business.

Here is a list of disaster planning tips State Farm® offers for small businesses, they include:

Safety first

  • Take time to plan evacuation routes and exits from your facility and mark them.
  • Install proper emergency lighting and exit signs to help show the way in case of power failure.
  • Designate staff “safety wardens” to guide and assist any emergency efforts, including regular drills.
  • Businesses should conduct emergency training exercises with all employees as frequently as needed to reinforce proper reaction times and responses.
  • Identify appropriate shelter spaces, such as a basement or storm cellar, in your facility for emergencies that may require them. If there is no basement in your building, go to the center of a small interior room on the lowest level away from windows or outside walls, such as a closet or interior hallway. Make sure spaces are kept clear of items that would limit their capacity or safety.
  • For more information about emergency safety procedures, visit the Federal Emergency Management Agency (FEMA).

Secure your assets

  • Contact a qualified contractor to discuss risk mitigation construction techniques for your building or office.
  • As an added precaution, you may also want to research places where you could temporarily relocate your operations if disaster strikes.
  • Maintain a comprehensive, up-to-date inventory of the items and equipment used in your business. Consider capturing these assets in photographs or video and securing the images and inventory files offsite.
  • Institute regular backup procedures for critical software and data to help ensure your business maintains access to the digital infrastructure it needs.
  • A business natural disaster plan will help get you up and running.

Following a disaster, you’ll want to resume business as quickly as possible:

  • Keep a name and telephone number list of contractors or repair firms who could make emergency temporary repairs or board up windows should some of your buildings be damaged.
  • Maintain a list of key suppliers, creditors, customers, and employees you need to contact about the state of your operation.
  • Construct a financial plan to cover continuing payroll expenses and debt obligations.

 

 

Mexico’s coral reefs get insured against storm damage

iStock, Riviera Maya, Quintana Roo, Mexico

An innovative insurance product is being deployed to protect several miles of coral reef  around Cancun and Puerto Morelos, reports Business Insurance.  The government of Quintana Roo, Mexico, purchased a parametric insurance product that would pay up to $3.8 million to repair hurricane damage to the reef.

Parametric insurance works using a clearly defined parameter (a metric or an index) that triggers the payout. Up until recently, parametric insurance was used by reinsurers for catastrophe risks, but it has started to be used in the travel, retail and agricultural sectors Insurance Business reported a year ago.

The reef insurance will be triggered if wind speeds above 100 knots are registered within the covered area, with a payout split of 50 percent for reefs and 50 percent for beaches.

One of the advantages of parametric coverage is that it pays out very fast, which is crucial since reef repair will need to be done very quickly to avoid further damage, according to Mark Way, director of Global Coastal Risk and Resilience at The Nature Conservancy in Washington.

“We hope this insurance approach will serve as a scalable model to build new financial mechanisms for the protection of nature,” said Mr. Way.

The insurance policy is financed by the Coastal Zone Management Trust, an organization formed in March 2018 to promote the conservation of coastal areas in the Mexican Caribbean.  Partners in the development of the reef insurance concept include the Nature Conservancy, the state government of Quintana Roo, the Cancún and Puerto Morelos Hotel Owners’ Association, CONANP, Mexican Universities and insurance industry representatives. Swiss Re Ltd. was an early partner in the development of the concept.

New York City’s Disaster Resiliency

Istock.com, J. Lazarin, New York City, USA – October 31, 2012: In the aftermath of Hurricane Sandy

It was a balmy 67-degree day in New York on March 15, which prompted the inevitable joke that since it’s warm outside, then climate change must be real. The wry comment was made by one of the speakers at the New York Academy of Science’s symposium Science for decision making in a warmer word: 10 years of the NPCC.

The NPCC is the New York City Panel on Climate Change, an independent body of scientists that advises the city on climate risks and resiliency. The symposium coincided with the release of the NPCC’s 2019 report, which found that in the New York City area extreme weather events are becoming more pronounced, high temperatures in summer are rising, and heavy downpours are increasing.

“The report tracks increasing risks for the city and region due to climate change,” says Cynthia Rosenzweig, co-chair of the NPCC and senior research scientist at Columbia University’s Earth Institute. “It continues to lay the science foundation for development of flexible adaptation pathways for changing climate conditions.”

“What you can’t measure, you can’t manage,” said Columbia University’s Klaus Jacob, paraphrasing Peter Drucker and making a concise case for the importance of the work the NPCC is doing.

The changes in temperature and precipitation that New Yorkers are experiencing are broadly tracking the climate change projections made by the NPCC in 2015. However, the 2019 report notes that such comparisons should be viewed with caution because of the role that natural variation plays in the short term.

William Solecki, co-chair of the NPCC said “Recent scientific advances have…helped the panel craft new sets of tools and methods, such as a prototype system for tracking these risks and the effectiveness of corresponding climate strategies.”

One such tool is the Antarctic Rapid Ice Melt Scenario, which the NPCC created to model the effects of melting ice sheets on sea level rise around NYC. The model predicts that under a high-end scenario, monthly tidal flooding will begin to affect many neighborhoods around Jamaica Bay by the 2050s and other coastal areas throughout the city by the 2080s.

The NPCC 2019 report recommends that the city establish a coordinated indicator and monitoring system to enable the city and its communities to better monitor climate change trends, impacts, vulnerability, and adaptation measures.

The report also notes the important role of insurance in support of climate change adaptation and mitigation. “Public–private partnerships are essential for facilitating infrastructure resilience, particularly for publicly owned infrastructure systems that often lack resources for resilience improvements. Coordination of insurance and finance is an important future direction to achieve comprehensive resiliency in infrastructure that reduces negative climate change consequences,” said the report.

The I.I.I.’s primer on climate change and insurance issues can be found here.

I.I.I. and the Weather Channel get the word out about flood insurance

How to Get Flood Insurance

Only 12 percent of Americans have flood insurance but many more will need it in a severe weather event. Learn more at iii.org about how they are helping homeowners and renters to obtain it.

Posted by The Weather Channel on Thursday, March 7, 2019

 

To make sure that homeowners are aware of the importance of flood insurance, the I.I.I. recently partnered with the Weather Channel.

A video posted to the Weather Channel’s Facebook page demonstrates just how destructive flooding can be; for example, in the video you can see the devastation from Hurricane Sandy wreaked on Breezy Point, a coastal community in Queens NY.

“What’s remarkable about flood insurance is that only 12 percent of people have it,” says Sean Kevelighan, I.I.I.’s CEO. One misconception that people have about flood insurance is that it’s included in a homeowners policy. But that’s not the case. A separate flood policy must be obtained. Flood insurance is mostly sold by FEMA’s National Flood Insurance Program, but some private insurers have begun offering it as well.

For those savvy enough to have purchased the coverage, it made a world of difference. “If we did not have flood insurance we would have been completely dependent on [government assistance]. It would never have been enough to fix out house”, says one resident of Breezy Point.

The video has garnered over a thousand views so far. We hope it leads to more people getting this invaluable protection.  For more information about flood insurance click here.