Swiss Re provides expert input for New York City study

Relying heavily on Swiss Re modeling tools, the report lists over 250 recommendations for increasing the area's resilience to natural disasters.

In the aftermath of Hurricane Sandy, New York City's Mayor, Michael Bloomberg, announced the creation of the Special Initiative for Rebuilding and Resiliency, which aims to identify ways to significantly improve the city's resilience to severe weather and climate change.

As part of this project, Swiss Re was commissioned to provide a quantitative assessment of potential climate related risks facing the City as well as measures that could reduce those impacts. The full report can be viewed here.

Recommendations for resilience

The report found that the annual expected weather-related loss for the five Boroughs of New York City is estimated at USD 1.7 billion, increasing to USD 4.4 billion by 2055. The modeling suggests that the increase in losses is split evenly between losses driven by sea level rise and those driven by more severe hurricanes. The report relied heavily on Swiss Re's internal modeling tools to translate the meteorological effects of climate change to a range of potential economic loss outcomes.

Detailed in the 400-page report are over 250 recommendations which could be implemented to increase the resilience of a city which is, in many areas, still recovering from Hurricane Sandy almost nine months after it struck.

Insurance a key component

Insurance is an important component of any resiliency plan, and the mayor's plan is no exception.  The report details how the insurance industry can play a significant role as the city rebuilds areas devastated by Hurricane Sandy, from education and outreach to consumers to the incorporation of resiliency measures in rate setting and underwriting methodology.   

While not explicitly mentioned in the report, public-private insurance partnerships are also a valuable financial tool available to governments.  These index-based insurance products, which settle in the first weeks after an event, provide governments whose jurisdictions are devastated by natural catastrophes with an injection of liquidity to offset costs incurred in the immediate wake of a natural disaster.

Mark Way, Head Sustainability Americas, for Swiss Re said: "This report is an important step towards improved resilience for the City of New York. We believe this project may set the standard and become a blueprint for other cities around the world dealing with the impacts of climate change."

Published 24 June 2013

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