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Tag Archive for 'weather'

Climate Change High On The Radar for Insurance Carriers

With 2012 recorded as the warmest year on record in the lower 48 states and also noted as the second most extreme weather year in U.S. history, insurers have climate change high on their radar.

The recent Ceres report, Insurer Climate Risk Disclosure Survey, shows that while extreme weather is regarded as the new “norm,” many insurance professionals are just beginning to think about how this severe weather will change their business. Climate change is being seen as a major financial threat to the insurance industry. Insurance carriers are looking to put strategic plans into place to deal with the topic of climate change in the coming years as carbon pollution increases worldwide and contributes to the increased problem of global warming. These strategies are aimed to manage their risk from rising sea levels, extreme wildfire, more droughts and severe heat waves in the coming years and decades.

The survey explains that there are five primary motivations for insurers to take action on climate change including:

-Impacts on revenue and profits
-Emergent risks from the future events triggered by climate changes
-Exposure of their insured who are will be exposed to the effects of climate change, both personal and commercial lines

Developing CAT models that anticipate climate changes and the consequential effects, plus advocating and supporting the reduction of carbon emissions are among the suggestions to carriers from Ceres.

Other strategies could include rate hikes for both personal and commercial accounts in disaster-prone areas, especially if carriers feel they will have difficulty enforcing hurricane deductible clauses in their policies. Reducing the supply of policies available in a a given area is another avenue being discussed.

In the restoration industry, losses can originate from both natural and man-made causes. While counting on weather, programs or good luck is not a predictable way to grow your business, knowing how to “pay attention” to those that can refer you the work, and even more so, being prepared for those moments are key to predictably managing your business for optimal growth.

What Happens When the Predictable Becomes Unpredictable?

As we all know, last Sunday was the one of the most anticipated days of the year, the 47th Superbowl. And, in a blog from last week, we discussed the idea of unpredictability and that while in the 47 years of the Superbowl game occuring, you never know when something can go awry, or, when the lights may go out (pun intended here). Many have referenced Superbowl 47 as the “Blackout Bowl.” For advertisers, they’ll remember the Blackout Bowl as the event that almost turned the lights out on one of, if not their biggest, marketing expenditure of the year. (On a side note, kudos to the companies that took advantage of the opportunity and leveraged social media to create engagement during the blackout!)

But lights out at the Superbowl for 34 minutes? Most folks would think that would never happen. David Letterman, the famous late night talk show host, joked that his 9 year old son said the lights must have gone out because of Beyonce’s hair dryer. Others ventured conspiracy theories that the blackout was an opportunity for the 49′rs to make a comeback.

In our blog last week, we discussed how even something like the Superbowl, that happens like clockwork every year, is not 100% predictable. And there are companies that will spend a large portion of their marketing dollars on a significant event like this in hopes that it will be the turning point in their sales.

Ironically, something unpredictable did happen during the Superbowl that really drove the point of the blog home. So, what do you do when the predictable sources of business you count on become unpredictable? And to that, the “predictable” sources, when you really look at them, are out of your control. For the restorer, this can equate to:

-The weather (the old saying “you can always count on the weather” doesn’t always ring true in our industry)
-Program work that can be there one day and vanishes the next
-Fire chasing, which current legislation moving through the system may make this type of work no longer feasible

This is just to name a few of the “predictable” sources of business that we see restorers rely on. But more often than not, what they really want is to predictably grow their business. They just don’t know how. In that case, it’s important to seek out solutions will grow you to the next level. Plus, you will need to have the proper systems, procedures, people and processes in place to do so as well. If you’re looking to know more about the different stages of business growth, click here for more information.

You can also visit www.theBDAway.com for more information as well.



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