3 things that can reduce risk of property cat loss recurrence: Aviva Canada CEO

Fire resistant cement board siding, hail-resilient asphalt shingles and backwater valves are among the measures property owners can implement now to protect their assets from climate-related disasters, Aviva Canada CEO Jason Storah suggested Tuesday.

“We have enough scientific data to help protect each other right now from massive climate-related devastation,” Storah said during Future of Insurance Canada 2021, an online conference produced by Reuters Events.

The Fort McMurray, Alta. wildfire in 2016 is Canada’s most expensive natural disaster, at about $3.6 billion, when measured by industry-wide insured losses. When cleaning up the wreckage, vinyl siding was installed on up to 2,500 homes, Storah said Tuesday during his presentation, COVID-19 and Climate Change: Two Questions, the Same Answer.

“For an additional 0.4% – in this case just $14 million – all of these homes could have been clad in fire-resistant cement board siding, likely reducing the risk of subsequent fire damage by more than 40%. But we didn’t,” Storah said.

The rebuilding after Fort McMurray was one of three examples Storah used to illustrate his central point: Sometimes we ignore science and we hope when we rebuild from the next weather-related natural disaster, the result will be different. Another key point was that science gave us COVID-19 vaccines and is also giving us the answers on mitigating climate change risk.

The other examples Storah gave (of how he suggests science sometimes gets ignored) were a 2020 hail storm and a 2013 thunderstorm.

On June 13, 2020, hail the size of tennis balls caused major damage, to tens of thousands of homes and vehicles, mainly in northeastern Calgary. On July 8, 2013, Toronto International Airport got more rain than it normally gets in all of July. Both of those events cost the industry more than $1 billion each.

In the 2013 event, more than 20,000 Toronto area homes suffered water damage from sewage that had backed up, Storah told the Future of Insurance Canada 2021 audience.

“Collectively, if we had spent 0.4% more – just an additional $36 million – we could have installed a backwater prevention valves on each and every one of those homes, reducing the risk of future water damage by more than 60%. But we didn’t.”

Scientific data can protect people, homes and businesses, Storah said.

Catastrophe Indices and Quantification Inc. (CatIQ) estimated the June, 2020 Alberta hail event cost the property and casualty insurance industry nearly $1.2 billion, making it Canada’s most expensive ever hail storm and the fourth most expensive insured catastrophe.