The Trump administration’s move to end the National Oceanic and Atmospheric Administration’s (NOAA) widely used weather and climate disasters database has created a significant data vacuum in the insurance and risk management sectors.
NOAA’s disaster database has long been a critical resource for insurers, brokers, and risk modellers. Its abrupt removal creates blind spots as hurricane season looms, impacting property insurance pricing, risk models, and underwriting accuracy, according to brokers Insurance Business spoke to.
“It’s a concern, especially as we try to be more analytical about what we do with our business,” said Blake Giannisis (pictured directly below), North American property practice leader at Hub International. “Brokers in general are thinking more like underwriters. So, we rely on the same tools that underwriters rely on.”
Within the first 100 days of his second term, President Donald Trump has ordered sweeping changes to federal departments and agencies, including deep cuts to research programmes and scientific research.
Months before NOAA pulled the plug on its database, the announcement spurred a mad scramble among climate and environmental researchers to archive critical datasets on US flood hazards, greenhouse gas emissions, energy production and environmental justice, among other subjects, the BBC reported.
The loss of NOAA data comes almost at the beginning of the US hurricane season, often a critical period for property insurers. Early forecasts suggest an above-average season, though slightly less active than last year.
For Giannisis, the loss of a trusted data source impacts his day-to-day work. "The first thing I thought of when I saw the announcement was that there will no longer be the tool that I've used many times in many presentations," he said, referring to NOAA’s signature visual map that displayed all billion-dollar events in the US throughout the year.
More than a visual aid, the database underpinned essential analytical processes across the industry.
“There are a few (insurers) that I deal with now that provide a lot of that kind of information,” said Giannisis. “But in many cases, I'll see the watermark that says NOAA was the source.”
Without NOAA’s authoritative, centralized data set, insurance professionals will be forced to pivot toward proprietary data sources, often at significant cost. Insurers with in-house analytics teams may attempt to replicate NOAA’s outputs, but it’s not a viable or affordable path for some firms.
“Our insurer partners rely heavily on [NOAA data],” said Giannisis. “Some of them have their in-house capabilities, and it will force them to either bring on additional staff or outsource to private data vendors.”
The ripple effect is expected to impact brokers directly. “It’s going to require more work for everybody as far as coming up with their own systems and proprietary data,” Giannisis said.
Scott Popilek (pictured below), Atlantic region leader at Risk Strategies, agreed. “The industry relies on this historical data to properly predict future events, set adequate pricing for risks, and assess the financial surplus or capital required to take on that risk,” he said.
Popilek warned that greater uncertainty or lower quality in the data could lead to higher pricing or even to some carriers being unwilling to offer coverage. “Cat modelling would become reliant on private data sources that may not be as comprehensive, leading to less reliable results,” he said.
While alternative data sources exist, such as NASA, the National Weather Service, and international monitoring bodies, they may not fully replace NOAA’s standardized, nationally focused offerings.
While cost is a concern, data consistency and trust are also important considerations. Proprietary data sources may not be transparent about methodologies, potentially introducing bias or gaps to the modelling.
“NOAA provides an unbiased view of weather trends and the resulting damage,” Popilek said. “While there are private data sources, accessing them would increase costs for both brokers and carriers. On the post-disaster side, I feel there are several other sources that can fill the gap.”
In the short term, brokers and insurers will likely turn to a mix of private vendors, public agencies, and in-house innovation to bridge the gap.
“It's all eyes on the next few months, especially as we just begin wind season,” said Giannisis.
