CRE Guide to Natural Hazards and Property Insurance Underwriting

Resumen del informe: The Commercial Real Estate (CRE) Guide to Property Insurance Underwriting, created by the ULI Urban Resilience Program, aims to support real estate owners, developers, and investors with an interactive initial search and reference tool to help the real estate industry grapple with increasing physical climate risk and rising insurance premiums by understanding risk reduction strategies and their implications for property insurance policies. 

This resource is intended for use by real estate risk management and sustainability teams, development teams, design teams, property and asset management teams, investment committees, or other stakeholders seeking information on what strategies are available to reduce risk from specific or multiple hazards and their implications for property insurance premiums.

This resource contains 50+ data points  that may be evaluated during the property insurance underwriting process specifically tied to climate and environmental hazards and their impact on premium cost. The resource includes:

• Applicable Hazard: which hazard(s) the asset is exposed to
• Applicable Geography: the location where property insurance premiums are impacted
• Relevant Underwriting Consideration: Asset characteristics typically evaluated during the property insurance underwriting process
• Underwriting Inputs: Data points that increase or decrease vulnerability to applicable hazards. Where a data point is unknown, the most typical answer is assumed during underwriting.
• Impact on Premium: How the underwriting inputs affect property insurance premiums. Where available, quantitative impact on average annual loss (ALL) is shared. A decrease in AAL may translate to a decrease in premium. Where quantitative impact is unavailable, qualitative impact is provided.