Resilience Plans are Key to Risk Management

Brief 

It would behoove developers and their contractors to include resilience as a vital risk-mitigation measure, as the threats posed by climate change accelerate and the value of construction disputes in North America soars, write Jessica Mederson of law firm Hansen Reynolds and Monika Serrano of Turner Construction. “Planning with future climate estimates in mind and incorporating resilience above and beyond what building codes require will be crucial,” Mederson and Serrano write.

Insight

While climate change may still be a disputed topic in the political realm, insurers have been aware of the risks posed by it for years.

More than half of U.S. state insurance regulators believe that climate change will likely have a high or extremely high impact on both the future scope of insurance coverage and the related underwriting assumptions, a Deloitte Center for Financial Services survey found.

In addition, the National Oceanic and Atmospheric Administration estimates that U.S. residents experienced 20 separate major weather and climate disasters in 2021, at a cost of $145 billion. The American Meteorological Society, which publishes an annual review of extreme events and their connection to climate change, has found that many extreme weather events have been affected by climate change.

Although climate change poses several threats, rising water levels is the most pressing facing many communities. Higher sea levels bring more storm surge, higher risks of flooding, saltwater intrusion and other destructive consequences. Meanwhile, as our atmosphere warms, it can hold more moisture, meaning more rain during a rainstorm. Combine those more intense rainfalls with the non-permeable surfaces that characterize modern towns and cities, and we see increased flooding.

Rising sea levels have received much of the focus in climate change discussions. While the global sea level rose approximately 6.7 inches in the 20th century, compared with the previous century — with an evident acceleration since the early 1990s — regional sea level rise was more or less than that average depending on several factors.