Impact of climate change on insurers as storm damage clean-up continues - WSAW
Impact of climate change on insurers as storm damage clean-up continues
UNITY, Wis. (WSAW) - There is a lot of work ahead for the people impacted by Tuesday’s storms.
The damage in Unity is devastating but neighbors are grateful as everyone comes together to help. It’s a type of help that climate experts forecast will become more common.
It’s not just clearing the debris, but repairing or rebuilding altogether. That’s not a cheap endeavor and insurance companies are keeping an eye on that fact.
Thursday, the people in Unity reflected on the past two days.
“Came up from the basement and kind of looked outside. And everything was gone, said Dawn Much.
Barb Elpert shared, “We have windows broke, we have the roof is bad. Our shed got hit and got smashed - it’s brand new.”
But as the sun shines, so does the gratitude of those in united in Unity. “We can’t do any of that stuff, we’re disabled. But the town come together, everybody’s calling everybody or walking to check on them. It was just the warmest feeling in your heart,” said Elpert.
Volunteers and neighbors have been providing their equipment, time, and labor for free as they wait for their insurance policy promises. Much said, “We have insurance. Our adjuster is actually on the way right now.”
Sean Sarver, Vice President of Claims at Mutual of Wausau explains, “The industry is taking some hard hits with some of the severe weather lately.”
In Wisconsin, insurance companies are still able to provide coverage, but industry experts know the climate projections are not looking good as the instance and severity of storms increase.
Sarver says, “Throughout the Midwest, throughout everywhere, you can see some of the personal lines carriers pulling out of different states and there are some changes that are being made to policies.”
Brian Darrey is the Property and Casualty Insurance Program Manager for the Wisconsin Office of the Insurance Commissioner. He says, “A lot of carriers may start getting away from the idea of replacement cost value for policies simply because the cost of it may just be too much for them to continue holding on to.”
That’s especially true for roof damage from hail. And in Wisconsin, the law does not require coverage to match existing materials.
Darrey says, “Say you have damage to one side of your house to the siding to trim or anything like that. He may not provide coverage for all sides to be made hold to match.”
“There are some things that are changing but we’re still able to provide the service,” says Sarver.
The Office of the Insurance Commissioner says if you’re having issues finding a company that will cover you, there’s a program called the Wisconsin Insurance Plan. It’s a state-funded insurance program. But the rates are typically higher.
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Related Knowledge Center: Climate economics
Climate change is now a driver of the world’s economy. The impact is profound:
- Catastrophic weather events — hurricanes, floods, droughts, high temperatures — are more frequent and more extreme. The cost can be measured in both the initial damage caused and the longer-term impact on the economy.
- Vulnerable communities are increasing climate-related investments, hardening infrastructure and taking other protective measures.
- Investment in carbon capture and storage technologies is increasingly rapidly.
- Governments are making investments and crafting regulations to reduce emissions of carbon dioxide and other greenhouse gases.
On top of all of this is the cost of uncertainty. As the Fourth National Climate Assessment, released in 2018 by the U.S. Global Change Research Program, says, “The assumption that current and future climate conditions will resemble the recent past is no longer valid.”