As communities across the United States work to rebuild after last year’s disasters, many face decisions about whether to invest in climate-resilient construction despite higher upfront costs and logistical challenges. The perception that these building standards are expensive continues to be a barrier, highlighting a gap in public awareness that affects adoption rates.
A recent report from Crawford & Company examines how claims leaders worldwide are prioritizing resilient construction as part of a broader industry move toward sustainability in claims processes. The findings, based on interviews and surveys with carrier and broker partners, show increasing support for incentivizing home upgrades due to their potential for long-term savings. These initiatives are often supported by insurers.
“When we can collaborate at an industry level and converge on some best practices, we’re going to create a lot more benefit for the effort that we put in,” said Pat Van Bakel, chief commercial and strategy officer at Crawford & Company, during an Executive Exchange with Insurance Information Institute (Triple-I) CEO Sean Kevelighan. “My advice is to be practical: think about what we can do that is going to drive some impact and then build from there.”
Van Bakel noted that although regional approaches vary due to economic, political, and legal factors, “most organizations have referenced sustainability or resiliency in their corporate strategy,” with 70 percent of respondents saying sustainability considerations affect their claims decision-making. Many companies are implementing programs aimed at making homes more resistant to severe weather events—a trend consistent with the industry’s growing focus on sustainable restoration over replacement.
Programs encouraging homeowners to retrofit roofs according to standards developed by the Insurance Institute for Business & Home Safety (IBHS) have gained traction when insurers provide grants and premium discounts. This construction method has been shown effective in reducing damage from storms and hurricanes. State governments are increasingly supporting similar programs.
Beyond reducing risk, these efforts can have additional benefits. “What they’ve found in those areas is that the home values have started going up and the prices of insurance have started going down,” Kevelighan said. He described this as creating an “economic flywheel to incentivize people to take action.”
In Dallas, Texas, Triple-I is working on establishing a property-based resiliency score so homeowners can access revolving loans or grant funds for necessary improvements.
California residents may also qualify for premium discounts if they meet wildfire mitigation standards through IBHS certification under updated state regulations known as “Safer from Wildfires.” These measures offer relief for Los Angeles homeowners still waiting for reconstruction after last year’s wildfires.
According to Van Bakel, real-world examples from disaster-hit areas demonstrate the value of resilient infrastructure: “You can see the benefit of putting resiliency into the infrastructure when there’s no other way to explain how one structure can look relatively unscathed and one right next door…is flattened or burned.”
The Crawford & Company report highlights how claims professionals help policyholders understand available resources such as resilience funding or code upgrade coverage. While 69 percent of survey respondents believe sustainability matters to customers, public education efforts remain limited.
Van Bakel advised insurers: “Follow what I would describe as the demand pull, rather than trying to create demand, and I think we’ll be a lot more successful.”
The Insurance Information Institute provides resources in English and Spanish for consumers, media members, and policymakers through its official website (https://www.iii.org/). The organization established ties with The Institutes in November 2020 (https://www.iii.org/) and represents over 50 insurance company members including regional, national, and global carriers (https://www.iii.org/). It aims to deliver data-driven insights on risk management while advancing understanding through events and partnerships (https://www.iii.org/). Its website serves as a leading online source for insurance information via articles, blogs, and social media channels (https://www.iii.org/).
