Our world’s climate is changing, and with it comes changingweather patterns.

Of particular concern are changes that are subtle, on average,but more severe in the extremes. These are the changes that havethe greatest potential to produce natural catastrophes affectingbusinesses, jobs and economies on a regional or global scale.

Working together with some of the most respected atmosphericexperts in the US, FM Global research scientists recently published“Coping with extremes - The impact of climate changeon extreme precipitation and flooding in the United States and howbusinesses can prepare now.” The results of ourresearch may surprise you, and we hope, lead you to start preparingfor the future.

The facts and science indicate that certain regions of theUnited States are expected to be prone to more intenseprecipitation events, and potentially increased risk of floodingwhile others are prone to less precipitation, prolonged droughtsand a potentially increased risk of wildfires.

The science behind it

Although extreme precipitation and flooding events are as old asrecorded history, the science of understanding the weather patternsthat cause them has dramatically evolved with enhanced computingpower and improved observational platforms. Available temperaturedata indicate a long-term warming trend on earth since 1850.

In our research paper, my colleagues and I warn that U.S.businesses and people will be exposed to changing precipitationpatterns in the century ahead, depending on their geographiclocation. Not all changes in weather patterns can be attributed tonatural variability or specific climate phenomena like El Nino.

First, Dr. Kevin Trenberth of the National Center forAtmospheric Research notes warmer air temperature will resultin increased water vapor loading in the air which supplements cloudformation leading to more intense, albeit not more frequentprecipitation. “The observed amount of total annual precipitationhas shown little change since 1950, but with increased water vaporin the air, the precipitation events become less frequent withstronger intensity.”

Professor Kerry Emmanuel of the Massachusetts Institute of Technologyreinforced this concept by analysis of the water cycle over oceans.“Basic physics tells us that as the climate warms, the water cyclebecomes more volatile. Absent large changes in atmosphericcirculations (for example, wind velocity and patterns) thisvolatility means that places that are usually very dry, likeSouthern California will likely get drier. And places where itrains a lot, like the Pacific Northwest and Southeastern UnitedStates, will probably experience more rain,” he said.

An additional consequence of extreme weather is increasedwildfires. As the temperature rises in areas that historicallyexperience dry conditions, the additional heat has the effect ofraising temperatures, and depleting soil moisture and therefore“exacerbating the risk of wildfire” says Trenberth.

Emmanuel notes: “What is conclusive is that based on strongtheoretical expectations backed up by climate models, most placeswill experience more volatile weather.

When businesses in the United States are significantlyaffected by extreme precipitation and flooding, the ramificationscan be felt throughout the global supply chain. (Photo:iStock)

The business forecast

Weather can have a positive or negative impact on the flow ofcommerce, affecting a wide range of businesses. Heavy rain orsevere snowstorms can shut down transportation networks or floodbuildings, and thus impact a company’s bottom line.

Extreme wet or dry conditions can affect buildings, machinery,data centers, transportation networks, supply chains, people andsales. When businesses in the United States are significantlyaffected by extreme precipitation and flooding, the ramificationscan be felt throughout the global supply chain.

Yet, many in the business world simply don’t think about extremeweather until it happens. Of particular concern to businesses, wefound, were psychological obstacles to preparation. One is“generational memory threshold,” where a community’s collectivememory is too short to remember prior major disasters.

Another obstacle is heedlessness. In earlier research done atFM Global,96 percent of financial executives surveyed said their companieshad operations that were exposed to natural catastrophes likehurricanes, floods and earthquakes; yet fewer than 20 percent saidtheir organizations were “very concerned” about such disastershurting the bottom line.

How do you protect your business?

Companies with built or planned structures in affected regions canprepare for extreme weather events in the future by taking actionnow. To begin with, risk managers and business owners alike mustrecognize the warming climate and consider the effect it will haveon their business.

According to Trenberth, “Water management is critical.”Businesses should sharpen their focus on water management, that is,diverting water from property, optimizing drainage and protectingwater supplies, and consider new weather extremes when managingsupply chains.

Related: 12 ways the U.S. is using nature to protect againstnatural disasters

Professor Minghua Zhang, of the School of Marineand Atmospheric Sciences at Stony BrookUniversity, part of the State University of New York system,agreed with this perspective and offered other ways for companiesand supply chain partners to prepare for more extreme weather.“Risk managers should make sure they review the resilience of theirbuildings or new locations to withstand the impact of an extremelyhigh rainfall event and area flooding,” he said.

Rather than just focus on the 100-year flood zone, businessesare wise to protect to the 500-year flood period levels so theyhave less than a 0.2 percent (1/500) chance of flooding every year.Often this doesn’t mean a huge change—a slight relocation ormodification will move a location from a 100- to a 500-year floodprotection level. When viewed over the lifetime of a building ormortgage, the risk is significantly reduced. As changes in thehazards evolve, this also provides an additional level ofprotection.

Related: After Hurricane Matthew: Here are 6 tips on how toget ready for the next one

Location, location, location

Now is the time for businesses to examine their buildings’ abilityto withstand flooding, as well as evaluate their processes tomanage surface water, roof drainage and water supplies. Similarly,companies should be mindful as to where they build new plants,factories and office structures, closely evaluating the potentialimpact of extreme precipitation and flooding.

As an engineering-driven property insurer, we collaborated withleading experts in atmospheric science to understand in greatdetail the effect of climate change on precipitation. As sound asthe underlying science is, no one should conclude that these aredetailed scientific predictions of any single time in the future.Uncertainties will always exist regarding the impact of climatechange on precipitation events locally and regionally.

We very much hope that business leaders will use this researchto focus their efforts on protecting from extreme precipitation andcontinually enhance their resilience by preparing their propertyfor whatever precipitation extremes they are likely to experience.There are more cost effective solutions that ever.

If your business is just starting to consider these hazards, anemergency response plan for every facility is the right place tostart. FM Global loss history illustrates that locations with aneffective Flood Emergency Response Plan resume operations faster,and experience 70 percent less loss during a flood. It’s time toget started.

Related: Is climate change affecting insurance claims?(Opinion)

Dr. Louis Gritzo is vice president and manager of research at FMGlobal. Gritzo also oversees activities at FM Global’s 1,600-acreResearch Campus in West Glocester, R.I.

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