The failure to take climate change seriously is akin to playing Russian roulette with the housing economy, according to experts. Consequently, it’s incumbent upon the insurance and mortgage industries to tap new technologies to ratchet up efficiency, while reducing risk and ensuring the protection of American homeownership and commercial assets. That's the message from the CoreLogic 2020 Catastrophe Report.
The report analyzes last year’s natural catastrophes through a host of perspectives, including climate change, the pandemic, and the overall threat to American homeownership.
Insurers and mortgage lenders can better understand peril risk and damages down to a parcel level by using catastrophe risk science, weather verification tools, and digital workflows.
In fact, last year marked the sixth straight year with over 10 weather events reaching losses catapulting $1 billion.
A cocktail of peril risk scores from CoreLogic reflect 35 million homes—which approaches a third of the U.S> housing stock—are highly vulnerable stemming from natural hazards.
The location of the homes at the highest risk: California, Texas, Oklahoma, Kansas, Nebraska, along the Mississippi River, and large Gulf and Atlantic coastal stretches.
A new study authored by researchers at Stanford University has determined that increased precipitation created by increased global temperatures have contributed to one-third of the financial costs of flooding in the U.S. over the past three decades.
The study, published in the journal Proceedings of the National Academy of Sciences, estimated that nearly $75 billion of the $199 billion in flood damages that occurred between 1988 and 2017 was the result of dramatic changes to the global climate. The Stanford researchers used climate and socioeconomic data for their study to determine if the increase in flooding was being driven primarily by climate change or by other ground-level factors including population growth, housing development, and increasing property values.
“The fact that extreme precipitation has been increasing and will likely increase in the future is well known, but what effect that has had on financial damages has been uncertain,” said Frances Davenport, a PhD student in Earth system science at Stanford’s School of Earth, Energy & Environmental Sciences and the lead author of the study. “Our analysis allows us to isolate how much of those changes in precipitation translate to changes in the cost of flooding, both now and in the future.”