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'Hurricane-proofing' buildings isn't enough to curb Florida's storm losses

Population growth and development in storm-prone areas dwarfs the benefits of enhanced building codes.

By Leslie Kaufman | October 02, 2023 at 01:58 AM
Stricter building codes adopted since 1975 have reduced the average expected annual loss in the U.S. by 60%-65%, but changes in hurricane activity increased risk by 25% and the value of property exposed to storms had risen by over 120%, leading to a net increase of upwards of 80% exposure. Credit: Eva Marie Uzcategui/Bloomberg Stricter building codes adopted since 1975 have reduced the average expected annual loss in the U.S. by 60%-65%, but changes in hurricane activity increased risk by 25% and the value of property exposed to storms had risen by over 120%, leading to a net increase of upwards of 80% exposure. Credit: Eva Marie Uzcategui/Bloomberg

(Bloomberg) — Since Hurricane Andrew in 1992, Florida has been toughening up building codes and touting them as a way to prevent large-scale damage in the wake of strengthening storms. But a new report by Swiss Re, one of the world’s largest providers of reinsurance, finds that added risk from population growth and development in storm-prone areas dwarfs the benefits of these beefed-up codes.

“Building codes are absolutely essential, but the more concentration [of assets in a place], the higher the risk is just going to be,” said Matt Junge, the U.S. head of property underwriting for Swiss Re.

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