June 23, 2014
Nationwide Insurance Calls for Incentives to Create More Resilient Homes and Businesses
Stronger structures more likely to survive storms
Columbus, Ohio - Today, Nationwide Insurance called on the federal government and state legislatures to introduce and pass legislation that will provide incentives for consumers, homebuilders and contractors to build or reinforce homes and small businesses using Insurance Institute for Business & Home Safety (IBHS) construction and retrofit standards.
“Losses that follow a natural catastrophe are not just financial in nature. Recovering from a hurricane or other natural disaster takes an emotional and psychological toll on families, business owners and communities that often far outweigh the financial cost of a loss,” said Mark Pizzi, president and chief operating officer of Nationwide Insurance. Pizzi also serves as the IBHS board chairman. “IBHS studies show that homes and businesses fortified by stronger building materials and construction practices are more likely to survive extreme weather events that otherwise would severely damage or destroy them.”
Nationwide Insurance believes that action must be taken to make homes and businesses stronger and more resilient. Incentives like building permit rebates, state-level tax incentives, and state and federal grants could lead to more resilient communities by offsetting some of the costs.
“Post-storm recovery efforts can require a significant allocation of federal and state funds,” said Pizzi. “Providing these fortification incentives before a storm hits could result in dramatic savings to our government and ultimately, to taxpayers.”
While government incentives are critical, Pizzi says insurance companies also must do their part to motivate consumers to fortify homes and businesses by providing incentives of their own.
“Insurance companies can offer discounts to consumers and business owners who fortify their structures. They also can offer insurance products that will help rebuild storm-damaged homes and businesses to FORTIFIED standards,” said Pizzi. “For example, consumers who purchase Nationwide’s Better Roof Replacement® product will have their damaged roof replaced with one that is built to withstand high wind and damaging hail.”
Nationwide is already seeing the positive impacts of IBHS’ stronger, safer FORTIFIED standards on a small scale in Mississippi. Nationwide Insurance worked with state regulators to be the first carrier in the state to offer mitigation credits on homeowners’ insurance to property owners ravaged by Hurricane Katrina. The hope is that more homeowners, business owners and ultimately, insurance companies follow suit.
“Thanks to work conducted by engineers at the IBHS Research Center, consumers can spend a relatively small amount of money to help protect not only their home or business, but more importantly, their loved ones, co-workers and valuable possessions,” said Pizzi.
IBHS’ FORTIFIED Home™ program uses a unique systems-based method for creating stronger, safer new and existing homes that are more resistant to damage from hurricanes, tropical storms, hailstorms, high winds and wind-driven rain associated with thunderstorms. With three levels of FORTIFIED Home™ designations available – Bronze, Silver and Gold – builders and contractors can work with homeowners to choose a desired level of protection that best suits their budgets and resilience goals.
“IBHS is proud that Nationwide is actively working to help break the historic cycle of destruction that families, businesses and communities have been stuck in for decades,” said Julie Rochman, president and CEO, IBHS. “By cobbling together a variety of meaningful financial incentives, we can effectively motivate property owners and builders to take steps that will make homes and businesses much more resilient – saving many lives and billions of dollars in disaster response and recovery expenditures,” Rochman noted.
“We never want the worst to happen, but by planning and preparing before a storm hits, we can try to help consumers and business owners recover more quickly and return to the life they enjoyed before the storm. Nationwide Insurance strongly believes that fortification is the best long-term preventative measure homeowners and business owners can take to protect what’s most important to them,” said Pizzi.
More information about the IBHS FORTIFIED program can be found at www.disastersafety.org/fortified-main.
About the Insurance Institute for Business & Home Safety (IBHS)
IBHS is an independent, nonprofit, scientific research and communications organization supported by the property insurance industry. The organization works to reduce the social and economic effects of natural disasters and other risks on residential and commercial property by conducting building science research and advocating improved construction, maintenance and preparedness practices. For information about how to make your home or business more resilient to extreme weather events and other causes of property damage, visit www.DisasterSafety.org.
Nationwide Mutual Insurance Company, a Fortune 100 company based in Columbus, Ohio, is one of the largest and strongest diversified insurance and financial services organizations in the U.S. and is rated A+ by both A.M. Best and Standard & Poor’s. The company provides a full range of insurance and financial services, including auto, commercial, homeowners and life insurance; public and private sector retirement plans, annuities and mutual funds; banking and mortgages; specialty health; pet, motorcycle, boat and farm insurance. For more information, visit www.nationwide.com.