Executive Summary:

The U.S. experiences a multitude of disasters each year. The cost of cleaning up and rebuilding destroyed homes, businesses, equipment, and infrastructure is immense and growing. In 2022 alone, the cost of natural disasters exceeded $360 billion across the globe, including more than 40 weather events causing over $1 billion in damage.

Investments in resilience and preparedness can reduce the cost of damage after a disaster. An accepted ratio is that $1 of investment reduces the damage and cleanup costs of a disaster by $6. What is less known—and what this study set out to find—is how investments in resilience and preparedness impact a community’s local economy, including jobs, workforce participation, production (GDP), and earned income for residents.

The Climate Resiliency Report from the U.S. Chamber of Commerce, Allstate, and the U.S. Chamber of Commerce Foundation shows that investments in resilience and preparedness can substantially reduce the economic costs associated with disasters. The study revealed that each $1 of investment in resilience and disaster preparedness reduces a community’s economic costs after an event by $7. That’s the median ratio for the 25 disasters modeled as part of the study.

That $7 of savings for economic costs is in addition to the $6 of savings for damage already assumed in our model. Combining the two ratios finds that every $1 invested in resilience and disaster preparedness saves $13 in economic impact, damage, and cleanup costs after the event.

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