Twenty-three billion-dollar disasters, $115 billion in damage, and not one hurricane: 2025 was a masterclass in how climate risk in the U.S. has changed.
Twenty-three billion-dollar weather and climate disasters struck the United States in 2025, revealing important takeaways for decision-makers in the real estate, public infrastructure, and insurance sectors.
Property insurance markets across the U.S. are under strain as premiums rise and insurers pull back from high-risk regions. In response, a growing number of states are leaning on public and quasi-public reinsurance backstops.
The Dixon Trail community in California could signal a way forward for stakeholders grappling with the heightened risk of building, owning, and insuring homes in the fire-prone West.
Francis Bouchard, Managing Director of Climate for Marsh McLennan, recently interviewed Roy Wright, CEO of the Insurance Institute for Business & Home Safety (IBHS), to discuss the future of insurance in the age of climate change and the importance of product innovation.
When disaster strikes, the question is not whether we will rebuild, but how. The problem is that it costs more to rebuild a home to disaster-resilient standards. We need new flexible and dedicated financing products that make it easier for homeowners to make critical resilience investments.
Insurers play a key role in sending risk signals, sometimes in a form other than price. These risk experts need to lead by reframing the “insurance crisis” as the “insurability crisis,” and leveraging a time-tested safety standard approach to align a complex ecosystem of competing interests.
Homeowners who built their homes to IBHS certified FORTIFIED standards saved thousands after Hurricane Sally hit in 2020. The FORTIFIED building standard is saving homes from Category 3 storm damage, and also saving homeowners and insurance companies costs on annual insurance premiums and claims.
At the recent Milken Global Conference, rebuilding LA was top of mind. Partnership, system-level engagement, and local leadership were key themes. And the insurance sector has a critical opportunity to reframe its role in disaster preparedness and society at large.
Unexpected disasters are causing damage in unlikely places, forcing decision-makers in the public and private sectors to prepare for the most common disasters in their region as well as the rare, once-in-a-hundred-year ones. But strategies exist to help decision-makers prepare for the unexpected.
