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Preparing for severe weather can help businesses protect lives and property

March 13, 2024

February in Wisconsin is usually a time of frigid temperatures, snow, and ice. The characteristic cold was noticeably absent on Feb. 8, 2024, when severe weather and tornados ripped through communities. One tornado was a “high end” EF2 that had a base more than 500 yards wide and traveled more than 24 miles.

There has never been a tornado recorded in Wisconsin during February,1 illustrating the point that large, damaging storms can occur almost anywhere at any time.

Severe convective storms – weather systems spawning severe thunderstorms, straight-line winds, hail, and tornados – have always warranted precaution, but the threat is growing and becoming more damaging.

Research based on National Oceanic and Atmospheric Administration data from 1980-2005 found that the U.S. averaged 2-4 storms per year that produced losses of $1 billion or more. In the last six years, research showed the country now averages 18 such events annually. Severity of losses has also seen a steady increase. From 1980-2020, the average annual loss attributed to severe storms was $9 billion. From 2020-2022, the average annual loss attributed to severe storms was $27 billion.2

In 2023, severe storms caused more than $54 billion in damages – the highest damage total ever attributed to severe storms. That figure comprised more than half of the damage costs for all of 2023’s major climate disasters, which stood at an estimated $92.9 billion.3

Peak activity and patterns

Extreme weather and the damage it causes is not confined to tropical weather and coastlines. Severe weather can happen at any time of the year, as the recent event in Wisconsin shows, and 2023 saw a record 410 tornados in January and February.4

There are seasonal patterns, however, that should trigger heightened awareness of the threat. Typically, severe weather strikes the central portion of the United States from early spring into summer. During this period, the clash of cool air from the north and warm, moist air from the Gulf of Mexico creates conditions that spawn severe thunderstorms in the central part of the country.5 Through the end of March 2023, Arkansas, Illinois, Indiana, Iowa, Tennessee, and Texas saw powerful EF3 tornados, according to NOAA data.

As the calendar progresses, states in the South, such as Alabama, Mississippi and Florida also have a secondary severe weather season in November and December.5

In addition, there is recent data that indicates traditional patterns may be shifting toward the east. Some studies have shown an emerging trend of more tornadic activity in the Midwest and Southeast, and a decrease in activity in the traditional Tornado Alley of the southern and central Great Plains.6 Businesses should pay close attention to the weather as peak season approaches and develop plans to reduce risk to lives and property.

Effects on businesses

An analysis of annual reports over the last 30 years shows that weather is increasingly mentioned as having an impact on business results.7 In 1994, the report shows that only 25% of businesses mentioned weather as impacting business results. By 2018, that segment climbed to 65%, indicating a growing impact across a wide range of industries.

The increased frequency and severity of the losses is driving commercial costs for insurers and customers alike. Effects of severe weather can vary from the immediate physical damage to longer-term impacts that can hamper business results.8

  • Property damage – The most obvious result of severe weather is physical damage to buildings and infrastructure. Roofs, windows, outbuildings, awnings, canopies, signs, skylights, and utility connections are just some of the structural components that should be safeguarded against potential damage. Property owners can review structures and ensure they meet current or enhanced building codes to help them resist extreme weather.
  • Vehicle damage – Flooding, flying debris, falling tree limbs, and hail all pose risks to vehicles during storms. According to Verisk, vehicle claims related to hail damage jumped 85% in 2023.
  • Labor and supply shortage – These effects can linger and continue to impact business results long after the storm. Businesses can suffer even if they have not sustained physical damage. Labor shortages can impact industries such as construction due to workforce supply and demand as an area recovers and rebuilds. Evacuations can also displace workers and make it difficult for businesses to operate at full capacity. In addition, damage to infrastructure like roads and bridges, or central shipping facilities can disrupt supply chains and make it difficult to resupply and move goods into a market.
  • Business operations and continuity – Flooded roads, disruption to the power grid, physical damage, or scarcity of workers can all disrupt business operations. This can in turn hurt a business’s bottom line. It’s important for businesses to have a clear understanding of the threats they face, and the roles associates play so operations can be restored as soon as possible after a storm.

Protecting lives and property

Any business can be impacted by severe weather, and a comprehensive risk management plan should be developed to address the specific risks each business faces. It’s critical that companies build resilience to extreme weather into their operations. Damage and operational disruption resulting from extreme weather can have a significant impact on an organization’s bottom line.

Property owners can reduce the potential for damage by performing regular inspections and maintenance of their property. Actions such as cleaning gutters and making sure doors and windows seal properly, or making sure signage is properly secured can help limit storm damage. Installing electrical surge protectors can also help prevent damage from lightning.

Investing in more resilient structural components – such as upgraded roofing materials, or fortified windows and doors that can withstand higher winds – can also help reduce the likelihood for damage.9 Buildings with upgraded materials and built to more resilient building codes can withstand violent storms much better.

Nationwide Loss Control Services has the expertise and resources to help businesses address the risks they face. A good first step is to develop a business continuity plan. This can help identify exposures and take action to mitigate the impact of adverse events. Organizations with continuity plans in place should review and update their plans regularly to ensure preparedness as the company evolves.

Here are additional resources that can help businesses understand the weather threat and implement protection strategies:

These materials and more on can be shared with customers to help educate them about severe weather events, prepare for emergencies, and establish business continuity plans.