As climate crisis forces insurance companies to abandon coastal areas, another U.S. state launches an Office of Risk and Resilience

On October 2, 2023, Alabama became the latest state to create an office devoted to climate resilience and assessing the risks it posed to people, the environment, and the economy.

And, the risks to insurance companies, which are increasingly rejecting new policies in coastal areas of the country.

That was when the Alabama Department of Insurance announced the launch of the Office of Risk and Resilience, an office dedicated to writing the future of mitigating various types of risk, helping Alabama protect residents and their property from severe weather.

The office will be led by Brian Powell, who has been promoted to the role of Deputy Commissioner and will hold the title of Director of the Office of Risk and Resilience.

Powell previously served as Director of the Strengthen Alabama Homes program, a grant program offering Alabama homeowners up to $10,000 to fortify their home against windstorms like hurricanes and tornadoes.

More than 6000 homes have been recipients of a Strengthen Alabama Homes grant and the program has helped Alabama become a more viable insurance market for both insurance companies and policyholders.

Through his work establishing and growing the Strengthen Alabama Homes program, Brian has proven himself as an effective leader in risk and resilience. States across the nation have modeled their own programs from the success of Strengthen Alabama Homes,” said Insurance Commissioner Mark Fowler.

Alabama will be well served by expanding the reach of the office to address the whole spectrum of risk and resilience issues. We look forward to great accomplishments for the people of Alabama from this newly expanded office within the department,” he added.

Innovative in concept and design within a government agency, the Office of Risk and Resilience will actively seek opportunities to help solve issues within the insurance industry in Alabama.

By assessing insurance market issues and determining market vulnerabilities, the office is tasked to help develop and implement risk controls to help sustain a healthy insurance market in Alabama. This office fills a need of working to provide resources and expertise to the insurance industry and consumers in the ever-expanding space of risk and resilience.

There has long been a need to assess and address vulnerabilities in Alabama’s insurance market and create solutions to solve them. We now don’t have to wait until a disaster strikes. We are being proactive in our approach to identifying and creating solutions to real problems, ahead of time, before they impact us all,” Powell said.

Responding to the challenges in today’s property insurance market, the establishment of the Office of Risk and Resilience is the latest step by the Alabama Department of Insurance to ensure Alabama sustains a healthy, stable insurance market for insurance consumers.

In 2012, the Alabama Legislature established an act creating the Strengthen Alabama Homes Program to address coastal mitigation. The benefits of mitigation were felt almost immediately, and the program has moved inland across the state of Alabama over the last several years.

The Strengthen Alabama Homes Program is a nationally recognized program that issues grants, mitigating homes to the Insurance Institute for Business and Home Safety’s (IBHS) Fortified Standard that hardens them against severe storms. It has become a springboard for the Fortified program in the United States and is the model program other states are adopting to lessen the risk of loss and help create a healthy insurance market.

Photo (courtesy of NOAA) shows boats aground in Alabama after Hurricane Katrina in 2005. The M/V Caribbean Clipper (left) was unloaded by crane six months later and refloated.

See Alabama Department of Insurance website.

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