If you think that investing in solar panels and a sustainable wardrobe instead of fast fashion are expensive, take a look at how climate change is escalating the cost of repairing disasters. The U.S. spent $95 billion on fixing damage caused by natural disasters last year, which was almost twice the 2019 costs.
These figures come from Munich Re, a German company that provides insurance to other insurance companies and is an expert in insurance-related risks. Last year was one of the warmest on record. In the U.S., people suffered from hurricanes in the south and east as well as massive wildfires in the west. “Climate change plays a role in this upward trend of losses,” said Ernst Rauch, chief climate scientist at Munich Re, in an interview with The New York Times.
Hurricane Laura, which hit southwestern Louisiana in August, was the costliest U.S. catastrophe in 2020, causing $13 billion in damage. But Hurrican Laura was only one of 30 named storms last year, 12 of which made landfall. Together they cost $43 billion in losses, accounting for nearly half the 2020 U.S. disaster total. Once hurricanes hit the land, climate change makes them likelier to stall, pummeling areas with wind and rain for more extended periods than usual, Rauch explained. Other types of costly storm activity in 2020 included tornadoes, hailstorms and derechos, a type of long-lived windstorm. An August derecho in Iowa and other parts of the Midwest decimated soybeans and cornfields and caused nearly $7 billion in damage.
Insurers are worried. New buildings need to stand up better to natural disasters. “We can’t, as an industry, continue to just collect more and more money, and rebuild and rebuild and rebuild in the same way,” said Donald L. Griffin, a vice president at the American Property Casualty Insurance Association. “We’ve got to place an emphasis on preventing and reducing loss.”
Of course, the U.S. isn’t the only country to be ravaged by the effects of climate change. Internationally, last year saw summer flooding in China, with only 2% of losses insured, and Cyclone Amphan, which hit Bangladesh and India, in May. Very few of Cyclone Amphan’s victims were insured. According to Munich Re, only $3 billion out of a total of $67 billion in natural disaster damage across Asia was covered last year.
Image via NOAA