In just a few hours, a severe storm can cause billions of dollars worth of damage. There is no silver bullet to reduce the costs of such storms, but there are a number of ways that asset owners, private sector investors, and companies can ensure their assets stand the best chance.

The following three levers offer opportunities for the private sector to enhance resiliency and reduce the costs of severe storms:

1. Invest in more resilient roofing
2. Adopt more resilient construction practices
3. Invest in new innovations and technologies

Lever #1: Fortify Existing Assets

Fortifying existing assets starts with stronger roofs. The majority of the costs from severe storms are due to hail, and the vast majority of hail damage occurs on roofs, according to Ian Giammanco, lead meteorologist at the Insurance Institute for Business and Home Safety (IBHS). While hail and high winds impact the built environment differently, many of the same fortifications can make structures more resilient to both hazards.

Traditional roofs in hail-prone areas last half as long (10 years vs. 20 years, on average) because they need to be replaced more frequently. This doubles the cost to homeowners and insurance companies over the same period of time. With the average cost of a roof in the U.S. at approximately $10,000, insurance companies are paying an average of 2x that cost over 20 years for roofs in areas that receive frequent hail. 

One way to fortify roofs against damages from severe storms is to replace existing roofs with impact-resistant roofing–roofing that’s made from similar materials as existing roofing (plastic, resin, asphalt, tiles, or metal), but fortified to be more resistant to hail impacts. Across the roof rating classes, Class 4 impact-resistant shingles are the least prone to damage. The average impact-resistant roof could last 60% longer than traditional roofs (30-50 years with impact-resistant shingles, as compared to 15-30 years for a well-maintained asphalt shingle roof). Increasingly, companies like Malarkey, Owens Corning, and Certainteed are producing impact-resistant roofing. 

The repeated replacement of unfortified roofs has led insurance companies to experiment with new models and incentives for homeowners. In some states like Oklahoma, insurance companies can reduce home insurance premiums by up to 42% if people install impact-resistant roofing. In Colorado, homeowners can save 28% on premiums by installing impact-resistant roofing.

Lever #2: Adopt More Resilient Construction Materials and Practices

More resilient construction materials and practices can ensure a structure withstands a severe storm. There are multiple business and investment opportunities in new construction and renovations. Beyond just roofing, impact-resistant materials can be found throughout the home: from concrete framing to strong exterior sheathing on the sides of homes to impact-resistant windows and garage doors.

FORTIFIED Home standards, a voluntary beyond-code construction program from the Insurance Institute for Business & Home Safety (IBHS), offers three levels of fortifications that builders can adhere to.

Until recently, there were no building codes specifically designed to protect structures from tornadoes (and there are still none for hail). But research from the National Institute of Standards and Technology (NIST) led to new building codes that are designed for high winds. A 2022 version of the codes, ASCE 7-22, is the first version to make high-occupancy buildings resistant to tornadoes.

States across the country are offering incentives for homeowners who build up to FORTIFIED standards. For example:

• Strengthen Alabama Homes pays up to $10,000 to upgrade to the FORTIFIED Roof or FORTIFIED Silver standard. 
• Strengthen Your Roof (North Carolina) offers grants of up to $8,000 for eligible policyholders who install a FORTIFIED Roof through the North Carolina Insurance Underwriting Association (NCIUA). 
• Strengthen Minnesota Homes provides eligible homeowners with $10,000 for roof upgrades on insured homes. 
• Strengthen Kentucky Homes offers policy provisions for upgrading single-family dwellings to the FORTIFIED Home standard. 
• Louisiana Fortify Homes grants homeowners up to $10,000 for hurricane-wind roof upgrades.
• Federal Home Loan Bank of Dallas (FHLB) provides up to $15,000 to homeowners with low-to-moderate income to upgrade an existing roof, or up to $7,500 for new roof installation that levels up to FORTIFIED. 

A 2023 FEMA Report, Improving Windstorm and Tornado Resilience: Recommendations for One and Two-Family Residential Structures, has outlined three areas of building where storm-resilient construction techniques can improve a structure’s ability to withstand severe storms:

1. Improve the resilience of the building's exterior roof, wall construction, and coverings. The performance of these exterior components depends on using better materials and proper installation. For example, instead of using the more common, smooth nails, the FORTIFIED-required ring-shank nails can double the strength of a roof against the forces of high winds.
2. Reinforce and protect a structure’s openings (windows, doors, and garages). Not only are windows, doors, and garages expensive to replace, when they’re open, they can increase the pressure during a severe storm. For example, IBHS research found that shutting doors during severe weather can reduce pressure on a roof by 30%. Meanwhile, impact-resistant glass and glazing strengthens windows and doors to withstand severe storms.
3. Ensure that the structural integrity of a house during a high-wind event adequately transfers and distributes loads. The “load path connections” throughout a structure (e.g. how roof beams and walls connect, or how floors and walls connect) ensures a house can withstand high winds. Investing in proper construction, better materials, and reinforced connection points can reduce the damage of a severe storm.

Lever #3: Invest In New Innovations and Technologies

By far, the best way to reduce the costs of severe storms is to build and fortify structures to resilient standards. But in specific circumstances, new technologies and innovations can play a role in reducing costs. 

Technology can reduce the damage to utility-scale solar projects. The majority of large, utility-scale solar projects use trackers, or systems that tilt the solar panels to follow the sun during the day. Increasingly, companies like Nextracker are producing hail mitigation products that connect to weather and use data to adjust panel angles ahead of hailstorms. Another company, ARRAY Technologies, has developed its SmarTrack technology that uses data to “stow” only the solar panel rows that are directly threatened by severe weather, allowing the rest to continue harnessing solar energy. HailDens360, developed by Kisters, is a high-resolution hailstorm forecast and sensing technology to minimize impacts to operations and assets.

Innovations can shield assets from hail. Companies like Hail No are manufacturing anti-hail nets to protect cars at dealerships and parking lots. Similar netting is used in agriculture to save crops from hail.

Conclusion

Severe storms are considered a secondary peril, a natural disaster type that is more frequent but generally less destructive. In spite of that classification, however, severe storms have become one of the most costly climate disasters in the U.S. There is no silver bullet to reduce their damage, but the private sector can play a major role in helping communities brace for the next storm.

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