Climate exposure drives commercial real estate insurance premiums to 2.4% of income, doubling in five years and reshaping property strategy.
Commercial property insurance premiums in the US have jumped 88% over the past five years, driven by rising climate risks. The cost now accounts for 2.4% of income receivable, up from 1.2% five years ago, according to industry data.
Insurance expenses vary significantly by location, construction, and hazard exposure, revealing disparities in underlying property risks. Retailers face higher costs and potential disruptions, forcing property teams to factor climate resilience into estate planning.
The shift moves climate risk from a sustainability issue to a core financial concern, impacting operating costs and long-term investment decisions for retail properties.