Changing Dynamics in Property Insurance

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Changing Dynamics in Property Insurance

Just like in 2020, weather-related claims proved to be expensive in 2021. According to a December 21, 2021, article published in the Claims Journal, a reported $105 billion in weather­ related claims was reported- the fourth highest on record. This number does not include the $531 billion in losses that occurred on December 30 due to 105 mph wind gusts that fueled a Colorado wildfire, which could drive the total cost even higher.

As the adage says, no one can control the weather. While that is true, a knowledgeable risk management and insurance professional can help provide risk mitigation and management insights to help protect your property and financial assets and provide you peace of mind.

A significant portion of these losses occurred in the coastal regions of the United States. Eight named storms hit the country during the 2021 season, nearly triple the average of three landfalls per hurricane season. Combined with 2020’s record-setting 11 landfalls, there have been 19 storms to hit the United States over the past two years.

The National Oceanic and Atmospheric Administration’s (NOAA) Office for Coastal Management reported that approximately 128 million people, about 40% of the country’s total population, live within America’s coastal regions. The population density is 461 people per square mile versus 87 for all other areas of the country (excluding Alaska). Since these regions produce more than $9.5 trillion in goods and services each year, it is no surprise that commercial real estate in these regions continues to grow as a large number of people relocate to the coast every year.

by Mary T. Pipino, CPCU

Executive Vice President

by Theodore S. Pipino

Senior Vice President