Creating resilient communities to avoid the next housing crisis | Fortune

"So why is there no national auto insurance crisis? In part because about 50 years ago the auto insurance industry established a risk management framework that started with data and ended with safety standards. In between were certain government mandates, narrowly targeted government risk pools and enough consumer demand that even Saturday afternoon truck ads are full of references to 4-star insurance safety ratings."

"If we hope to avoid a housing crisis in America, we need to do that again for the rapidly escalating risks posed by wildfires, hurricanes, extreme heat and flooding. The first step - again - would be establishing one source of credible, publicly verifiable data that deepens our collective knowledge of the risks. In other words, we need a crash test dummy for homes, communities, and watersheds to inform and improve local decision-making."

"Once we have those community-level insights, we can bolster the case for dramatically expanding the effective yet sub-scale deployment of home safety standards like the Institute for Business and Home Safety's (IBHS) Fortified or Prepared home designations. The government, particularly at the state level - where insurance is regulated - should use the same data to steer various forms of capital to the right resilient infrastructure."

Centralized, publicly verifiable community-level risk data is necessary to inform local decision-making and prioritize resilient infrastructure investments. A standardized assessment framework—a crash test dummy for homes, communities, and watersheds—would deepen understanding of hazards from wildfires, hurricanes, extreme heat, and flooding. Community-level insights would justify dramatically expanding effective but under-scaled home safety standards such as IBHS Fortified or Prepared. State regulators should use the data to steer capital, embrace innovation, and restrict taxpayer exposure to true market failures. A cultural shift is required to create consumer demand for home safety on par with automotive safety.

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