Disasters pose a significant financial burden on affected individuals and communities, as well as the broader economy. This impact only continues to grow as disasters continue to escalate in frequency and severity across the nation.
To address this pressing issue, a panel of experts at the U.S. Chamber Foundation’s 12th Annual Building Resilience Conference discussed innovative approaches to reducing risk and cost, thereby bolstering community resilience.
Ongoing Investment and Incentives Can Drive Disaster Mitigation Efforts
The impacts of climate change can be seen in the recent rise of natural disasters across the country. Roy Wright, President & Chief Financial Officer at IBHS, noted that grant programs are critical to providing aid — but grant money alone isn’t enough to drive down costs.
“It requires investments of people’s hard-earned money,” Wright elaborated. “There’s a top 25 percent or so of Americans who likely could afford to take those actions — how do we nudge them … to do that? [And] how do we get businesses to take those kinds of actions?”
Daniel Kaniewski, Managing Director of the Public Sector at Marsh McLennan, echoed Wright’s sentiment.
“The government alone can’t solve this problem,” Kanieswki emphasized. “It’ll take incentives for individuals … but it’ll also take incentives from a policy standpoint or incentives from other industries.
Romaine Seguin, CEO of Good360, emphasized the need for ongoing financial support in disaster mitigation — not just in the first few days, but on an ongoing basis.
“Two weeks, two months, six months [later], people are still displaced,” said Seguin. “We can really see our strength [in] the stages of a disaster, and collectively, we can support all stages together to start mitigating some of that expense.”
Encouraging ‘Good Behavior’ Can Encourage Communities to Take Preventative Action
Kaniewski acknowledged that the emergency management sector should be using “every tool in the toolbox” to encourage “good behavior” across communities.
“One of those tools is … parametric insurance, which is essentially paying out after a specific event happens,” he explained. “There’s no need for doing insurance adjusting or damage assessments, and that can cover an entire community.”
To assess the viability of this strategy, Marsh McLennan launched a pilot in a low-to-moderate-income community in lower Manhattan. By participating in this initiative, residents would receive a level of financial protection from potential flooding in addition to any federal funds from FEMA.
“These underserved communities, they generally don’t have renters’ or homeowners’ insurance, much less flood [insurance],” Kaniewski noted. “But a solution like this, that we brand as ‘community-based catastrophe insurance,’ we believe … can help close the gap between those who are insured and those who are uninsured.”
Pre-Disaster Mitigation for Supply Chains Ensures Communities Get the Support They Need
When disasters strike, communities often need aid in the form of supplies. A pre-disaster mitigation approach can ensure supply chains are strong enough to provide sufficient, timely support.
“If we pre-stage the product now and mitigate the hiccups in the supply chain, we can get [that] much ahead of this when victims are in need,” Seguin said.
Wright agreed, noting that disrupted chains can limit the availability of necessary materials to rebuild stronger communities.
“Sometimes, the pre-disaster mitigation is really about making sure that near-term recovery and repair frame has the availability that logistics have played out,” he added.
Of course, the task of building resilient supply chains — and encouraging communities to be proactive about disaster mitigation and prevention — can’t be done in a silo.
“We need to do better advocating for this … [because] advancing these issues is so critically important,” emphasized Kaniewski. “The bottom line for me is none of us can do this on our own. We need to do this together.”
