ST-2 - Navigating Climate and Migratory Pattern Changes in Home Insurance

Over the past several years, climate-related trends have had a significant impact on insurance companies and consumers alike. As different climate patterns have emerged over the past several years, the evidence is compelling: the warmest six years on record have occurred since 2015; eight of the 10 largest wildfires in California history have occurred since 2017;The number of strong storms is increasing; and Hurricane Ian—with damages worth an estimated $113 billion—was the third costliest hurricane in U.S. history and just one of the 18 separate billion-dollar disasters in 2022. Exacerbating the risks brought about by climate-related trends is a recent demographic trend: migration within the U.S. More consumers are migrating to areas with higher weather-related risks. When one considers all the new dynamics in play, there is little doubt that climate change insurance risk is intensifying, and the insurance industry must understand these changes in order to adapt. This discussion will highlight the migratory and climate changes affecting the U.S. and quantify the impact to insurance carriers.