In a quiet catastrophe season, the insurance industry shouldstress to policyholders the importance of preparing their homes fornatural disasters and becoming both physically and financiallyready for whatever Mother Nature has in store. Additionally,insurers can use these mild years to build up capital reserves sothey can afford to pay claims when events do occur. The quiet yearsalso allow policymakers time to develop longer-term solutions thatcan ultimately strengthen Homeowner insurance markets.

The enactment and enforcement of tough standards for buildingcodes, property development and other loss prevention andmitigation requirements are key components to long-term naturalcatastrophe preparation. As an example, following devastatingtornadoes in 2013 that ravaged central Oklahoma, the City of Mooretook action this March and became the first in the nation to adoptbuilding codes that are specifically designed to address the impactof tornadoes. Moore's new residential building codes includerequiring roof sheathing, hurricane clips or framing anchors,continuous plywood bracing and wind-resistant garage doors. Thehomes will be built to withstand winds up to 135 miles per hourrather than the accepted standard building requirements of 90 milesper hour.

According to data from National Oceanic and AtmosphericAdministration, the Southeast has experienced more billion-dollardisasters in the past 30 years than the rest of the countrycombined.

This is why it is so important for states including Alabama,Mississippi and Texas to explore ways to strengthen building codesthat can protect residents from excessive damage in the event ofsevere weather.

It can take several years to achieve significant reforms and theenactment of statewide building codes is often an issue thatrequires a sustained, multi-year effort to achieve the goal.

Mississippi is a case in point. Just this November, the stateimplemented its first statewide building code after several yearsof work. These new standards, which became effective Nov. 28, couldpotentially save lives, reduce damage after a major weather event,and lower insurance costs. The stronger building codes will ensurethat residential and commercial buildings are built to withstandgreater hurricane force wind and impact from flying debris.

Insurance Commissioner Mike Chaney, Governor Phil Bryant, thelegislature and the insurance industry worked diligently to enactS.B. 2378 and put in place a statewide building code. The PropertyCasualty Insurers Association of America (PCI) and its members havebeen working to push for stronger building codes since 2005, whenthe state was hit by Hurricanes Katrina, Dennis and Rita. Accordingto the August 2013 report issued by the Insurance Institute forBusiness and Home Safety, Mississippi had the weakest buildingstandards of all hurricane prone states.

Meanwhile in Texas, the House Insurance Committee and the Landand Resource Management Committee held hearings to examine coastalresiliency, hazard mitigation, building codes and the role ofinsurance in protecting the coast. Although Texas has good codeenforcement in some coastal areas, it can be less stringent inother areas. For greater consumer protection, PCI is urging thatthe code be made mandatory for the entire area and that thestatewide building code be updated.

While building code legislation did not pass in Alabama,lawmakers seriously considered adopting H.B. 614, which was verysimilar to the law enacted in Mississippi. Alabama is no strangerto extreme weather conditions and with a long history ofdevastating catastrophes, it has had its share of hurricanes,tornadoes, flooding and severe storms. The April 27, 2011, tornadooutbreak, which was part of a series of destructive tornadoactivity from April 25-28 across the eastern third of the country,was unimaginable. Among the various states ravaged, the central andnorthern Alabama regions were the hardest hit with 235 fatalities.Alabama's outbreak alone—its deadliest since 1932—is ranked amongthe top 10 worst natural disasters in U.S. history, resulting inmore than $4 billion in insured losses primarily in the Tuscaloosa,Birmingham and Huntsville metropolitan areas. Additionally, Alabamaexperienced damage from other record-setting storms such asHurricanes Gustav in 2008, Katrina and Rita in 2005 and Ivan in2004.

While the frequency and severity of weather events cannot becontrolled, something can be done to help control the cost impacton consumers. As was done in other states, it is now Alabama's timeto address its vulnerability to catastrophic losses and takeproactive steps toward ensuring a healthy and competitive privatehomeowners market. In turn, Homeowners insurance will become moreavailable and affordable for Alabama's residents.

Loss mitigation should be at the forefront of any propertyinsurance solution as the state promotes public safety, minimizesproperty damage and preserves communities hit by naturaldisasters.

With 2014's legislation, it is important to build upon themomentum and push for stronger building codes and encourage thehardening of residences.

More property carriers will operate in Alabama and investcapital in the state. Increasing construction standards to makebuildings more resistant to damage will decrease the frequency andseverity of property claims over time and provide a positivestabilizing effect on costs. Lesser amounts of property damage froma natural disaster speeds up the recovery process, causes lessdisruption for property owners and puts less pressure on theinsurance marketplace.