Climate disasters such as wildfires and severe storms are occurring more frequently and damagingly in the United States, accounting for 83% of the estimated $107 billion in global insured losses in 2025, according to a new report from the Swiss Re Institute.
This is the sixth year in a row that global insurance losses have exceeded $100 billion.
According to Swiss Re, January’s Los Angeles wildfires were the costliest wildfire in the world, with insured losses alone reaching $40 billion.
The insurance research firm said the rising costs are due in part to rising property values and homeowners building in areas with a particularly dangerous mix of wilderness and urban areas.
“Insurance losses continue to rise amid high annual volatility, so increased prevention, protection and preparedness are essential to protect life and property,” Swiss Re Group Chief Economist Jerome Jean Hegeli said in a news release.
Insurers are increasingly asking policyholders for relief. In areas prone to wildfires, this may mean cutting down trees and trimming vegetation to create a defensive zone around homes and buildings. In hurricane-prone areas, building materials and construction methods need to be focused on to increase resilience.
FM, a mutual insurance company for commercial and industrial real estate, has a special research campus in Rhode Island where a team of engineers tests and certifies materials and systems designed to withstand all types of hazards.
“We’re an engineering company that does insurance,” FM CEO Malcolm Roberts said in an interview with CNBC. “We don’t sell insurance capabilities without engineering, and we don’t sell engineering without insurance.”
FM engineers have developed extensive tests that simulate things like Category 2 hurricanes, severe hailstorms, wildfires, earthquakes, and even dust explosions.
FM employs approximately 2,000 engineers who work with each client to identify specific risks and implement resiliency solutions, such as improving roof and wall materials or installing sea walls.
“We can’t stop hurricanes from coming, but we can prevent them from happening,” Roberts said.
For the 190-year-old company, hail is an increasingly costly natural disaster that is increasingly attracting attention. It is also the main cause of damage to solar panels.
FM uses powerful “hail cannons” to test the resilience of roofing materials and solar panels to see which products can withstand impacts. FM issues certificates certifying which products meet the highest standards for property loss prevention.
“We understand the size of hail that is prevalent in the area, and we test solar panels for that size of hail with appropriate impacts and design test standards,” said Lou Grizzo, FM’s chief scientific officer.
“It’s important for businesses to know that by requesting an FM-certified roof, they’re getting a roof that they know will withstand storms in their wind range,” he said.
Investing in mitigation solutions can be expensive, but FM offers resilience credits to help you do just that.
“(We) give back 10% of our clients’ insurance premiums to our clients and help them implement solutions, whether it’s climate, fire or equipment risks,” Roberts said.
He added: “Rather than paying a premium to me, I want my clients to put that money toward risk mitigation because in the long run, the deal works out very well for both parties.”
Insurer Hippo similarly advises insurance customers on mitigation measures such as automatic or remote shutoff of gas, water and appliances.
USAA proactively contacted its 3 million members in 2025 to instruct them on protecting their assets, the insurer said.
“Our members are participating together in loss mitigation programs, such as water leak valves and electronic devices that can be installed in homes to detect surges. All of that ultimately helps,” USAA CEO Juan Andrade told CNBC.
