WASHINGTON — For the past nine years, Alabama has been doling out money to homeowners on the coast to upgrade their roofs, and on Tuesday, the initiative received interest and praise during a Senate hearing on U.S. housing innovation.
The Strengthen Alabama Homes program offers residents of coastal communities in Alabama up to $10,000 to retrofit their roofs to better withstand hurricane-force winds. And it’s been successful. A study, published earlier this year, showed fortified homes had fewer insurance claims after Hurricane Sally pummeled the area in 2020.
The Fortified standard is a voluntary construction code from the Insurance Institute for Business & Home Safety that requires a sealed roof deck and impact-resistant shingles and stronger vents that can withstand severe weather.
The University of Alabama’s Center for Risk and Insurance Research conducted that study and its director, Lars Powell, testified about that success during Sen. Katie Britt’s Senate Banking Subcommittee on Housing hearing.
“We believe that Fortified represents a solution, not a mitigation or an assist, but a solution to insurance affordability for the perils that we face in Alabama,” Powell said during Tuesday’s hearing.
This year, the grant program is expanding in Alabama to residents of Jefferson, Tuscaloosa and Escambia counties after previously being available only to Mobile and Baldwin counties. More than 53,000 homes in the state have been fortified.
“I believe this type of initiative is the type of thing we should be thinking about when we’re looking at the housing market and we’re taking a comprehensive view of what needs to be done long term,” Britt, R-Ala., chair of the subcommittee, said. “I have several family members in the audience today, and one of them actually lives in a coastal community, and obviously, what happens when storms come and what happens in the aftermath is tremendous.”
After Hurricane Sally, homes that met the Fortified standard fared far better than conventional construction homes and experienced a reduction in insurance claim frequency by 73% and a 15% reduction in claim severity, according to the study.
“It gives the consumer a strong incentive to build Fortified and so our strategy has been effective,” Powell said. “We see huge returns to these incentives.”
Based on that success, other states have followed suit. The subcommittee’s top Democrat, Sen. Tina Smith of Minnesota, said her state “has drawn inspiration from the work that you all have done in Alabama.”
Smith asked Powell how Alabama was able to get insurance companies to offer lower premiums for homes with Fortified roofs.
“We have benchmark discounts for Fortified homes,” Powell told Smith. “They’re different based on where the house is located and which level of the Fortified standard it’s built to and they’re all actuarially justified.”
The program can also help states that deal with other types of severe weather such as hailstorms in Minnesota, Powell said.
Britt also asked Powell about how the cost of retrofitting a home with these roof upgrades compares to the money that could be saved from insurance premiums once the improvements are complete.
He contended that the upgrades can cost a little bit more than conventional construction up front, but when combined with insurance discounts, Fortified homes are “still a good deal.”