Hazard Briefings

The Epicenter's first series is a collection of briefings that explores opportunities for infrastructural resiliency to the most common disaster types. For each, we unpack the drivers leading to increased damage and cost, the levers to reduce those impacts, and how capital allocators, or decision makers with budgets, can make the insights actionable.

These briefings are meant to be evergreen and will be regularly updated as information changes and evolves. If you see something that is out of date, or if you have a recommendation for a better example we could incorporate, please send it our way!

Hazard Briefing Topics

1. The perfect storm: why disasters are so expensive | This overview of disaster costs explores what makes a disaster, how costs are measured, the drivers of $1 billion disasters, and an overview of how resiliency investments can reduce losses.
2. Wildfires | Part 1 explores the drivers putting people and assets at risk from wildfire. Part 2 unpacks the levers that present opportunities for private capital to reduce the frequency, severity, and costs of wildfires.
3. Hurricanes | Part 1 provides an overview of hurricane costs and what about their destruction makes hurricanes so expensive. Part 2 overviews the three key levers that present opportunity for private capital to make infrastructure and assets more resilient to hurricanes.
4. Extreme Heat | Part 1 explores the drivers that make extreme heat both costly and dangerous. Part 2 offers perspective on what investors can do to reduce the costs and dangers of extreme heat.
5. Severe Storms | Part 1 breaks down the cost drivers that make severe convective storms so destructive and expensive. Part 2 provides an overview of the levers that exist to reduce those costs and impacts.
6. Winter Storms | This briefing provides an overview of the costs associated with snowfall, freezing rain, strong winds, icy roads, and freezes and the levers that exist to reduce those costs.
7. Earthquakes | While distinct from other weather-related disasters, this briefing will explore the costs associated with earthquake damage, and the opportunities that exist to fortify infrastructure and assets to reduce the damage and costs from earthquakes.
8. Flooding | Flooding occurs with multiple disaster types, including Hurricanes and Severe Storms. This bonus briefing will explore the cost drivers associated with both coastal and inland flooding and the unique role that flood insurance plays in managing and reducing flood-associated costs and impacts.

Themes across these Hazard Briefings

Why are billion-dollar disasters suddenly everywhere? Are the most expensive disasters, like Hurricane Katrina, becoming more frequent? Or are the most frequent disasters, like a 30-minute hail storm, becoming more expensive? 

The story, as our research reveals, is more complex and nuanced: there are a small handful of factors that have conspired to create a perfect storm of expensive, frequent disasters—whether they’re severe weather in Texas, wildfires in California, or flooding in the northeast. The time is shrinking between disasters hitting. The costs are rising. The need to protect assets and reinforce critical infrastructure is only becoming more urgent.

As these dynamics intersect, four key categories of cost drivers have emerged:

1. Higher frequency and greater severity are increasing the cost of disasters

The U.S.’s Fifth National Climate Assessment, released in 2023, found that climate change increases the frequency of weather extremes that lead to billion-dollar disasters. Extreme weather begets extreme weather, as Mathew Sanders of Pew Research explained, “Extreme heat can exacerbate drought conditions, increasing wildfire risk. Wildfires leave behind barren landscapes, where vegetation would otherwise reduce runoff, increasing flood risk and leaving hillsides vulnerable to mudslides.”

2. Greater asset exposure drives costs up

There are more assets at risk today than there were in the 1980s. NOAA credits both the increase in population and the increase in asset prices as key drivers of rising costs. Population growth, population migration, and unsustainable and discriminatory land use and development have pushed communities into harm's way. Today, 39% of all the houses in the U.S. are in the wildland-urban interface (WUI). The #1 and #2 fastest growing states in the U.S. from 2022 to 2023—Texas and Florida—are also the states with some of the greatest climate risk and highest frequency of disasters each year.

3. More vulnerable assets translates into more expensive disasters

Greater vulnerability of an asset, as measured by the extent of damage caused by a given hazard, also drives up insured and uninsured costs. Without up-to-date building codes and new disaster resilient construction materials and technologies, assets remain vulnerable to greater damage. Severe storms can quickly turn into disasters costing billions of dollars. Meanwhile, as insurance premiums spike, more homeowners are going without insurance (more than 1 in 10 U.S. homes is uninsured), further exacerbating the vulnerability of what is often their most valuable asset: their home.

4. Premiums to rebuild drive up reconstruction costs

In the wake of a disaster, there is a rebuilding premium as a surge in demand outpaces supply, leading to soaring costs. According to a 2023 report by Harvard University’s Joint Center for Housing Studies, every year across the U.S., $20 billion is spent to repair homes—just homes—following both minor storms and major disasters. This is a $3 billion annual increase from 2021 (just two years prior to the report), and nearly double the $12 billion spent annually in the decade between 2000 and 2010.

While these drivers increase overall disaster expenses, resiliency levers exist to reduce costs and build more resilient infrastructure.