2020 marked the sixth consecutive year with more than 10 weather and climate disasters that surpassed $1 billion in economic losses.
The U.S. received little relief from the occurrence of natural disasters in 2020, which marked the sixth consecutive year with more than 10 weather and climate events that surpassed $1 billion in economic losses, according to CoreLogic’s newly released 2020 Climate Change Catastrophe Report.
Many properties in the U.S.—even outside coastal areas—are at risk of flooding, hurricanes, wildfires, earthquakes, or damage from wind and storm surge. The homes at highest risk are in California, Texas, Oklahoma, Kansas, Nebraska, and places along the Mississippi River. Large Gulf and Atlantic coastal stretches are at risk of hurricanes, storm surges, and river flooding, the report notes.
Home buyers and sellers are growing more concerned about natural disasters. Nearly three-quarters of Americans and Canadians who bought or sold a home in 2019 say that an increase in the frequency and intensity of natural disasters is “somewhat” a factor in their decision to buy or sell, according to a survey conducted earlier this year by real estate brokerage Redfin. Of the 29 metro areas tracked in the survey, Houston residents were the most concerned about natural disasters, with nearly 60% saying that an increase in the frequency or intensity of natural disasters “very much” factors into their decision to buy or sell a home. New York followed at 47%, and Miami was third at 46%. Overall, people in the South and Northeast—36% and 35%, respectively—say that natural disasters seriously impact their real estate decisions. Midwest respondents have the lowest concern about the impact of natural disasters, according to the survey.
CoreLogic researchers call for better disaster resilience to protect individuals and homes. For example, they say strengthening new homes is important to reduce losses from fires and natural disasters. Property risk analysis to accurately predict possible damage from disasters could help insurers protect homeowners, including private flood insurance, parametric insurance (which protects a policyholder against the occurrence of a specific event by paying a set amount based on the magnitude of the event), and wildfire insurance.
“2020 has been quite a year,” the report says. “The nation has seen record-breaking wildfires, hurricanes, floods, and tornadoes, prompting governments, insurers and property owners to think of new ways to mitigate risk and make neighborhoods more resilient.”
Source: “2020 Climate Change Catastrophe Report,” CoreLogic (2021)