By: Frank Came, Communications Director. Pacific Northwest Building Resilience Coalition
Designing and building resiliency is becoming increasingly important due to the growing frequency and severity of natural disasters. The financial benefits of this approach are multifaceted and can be substantial.
Cost Savings through Reduced Damage
Building structures that can withstand natural disasters can lead to substantial cost savings by reducing the need for repairs and reconstruction.
A study by the National Institute of Building Sciences found that for every dollar invested in disaster mitigation, the country saves an average of $4 in disaster costs. This is because resilient buildings are designed to minimize damage from extreme weather events, thereby reducing the financial burden on property owners and taxpayers.
Reduced Insurance Premiums
Resilient buildings may also qualify for lower insurance premiums, as they pose a lower risk to insurers. According to a report by the Insurance Institute for Business & Home Safety, buildings constructed to be more resilient can lead to reduced insurance costs, as insurers are more likely to offer discounts for properties that meet specific resiliency standards.
For instance, the Federal Emergency Management Agency (FEMA) provides discounts on flood insurance premiums for communities that adopt and enforce floodplain management regulations.
Increased Property Value and Economic Activity
Resilient design and construction can also increase property values and stimulate local economies. A study published in the Journal of Urban Economics found that buildings that are designed to be more resilient to natural disasters tend to have higher property values and are more attractive to businesses and residents.
Furthermore, resilient infrastructure can support economic activity by minimizing disruptions to businesses and supply chains during and after disasters.
Job Creation and Economic Benefits
Investing in resiliency can also create jobs and stimulate local economies. A report by the International Labour Organization found that investments in disaster risk reduction and management can generate employment opportunities in construction, infrastructure development, and other sectors.
Additionally, a study by the Urban Institute found that every dollar invested in infrastructure creates approximately 3.4 jobs and stimulates local economic activity.
In conclusion, designing and building resiliency offers numerous financial advantages, including cost savings, reduced insurance premiums, increased property values, and job creation. As the frequency and severity of natural disasters continue to grow, investing in resiliency is becoming increasingly important for individuals, businesses, and communities.
