The National Oceanographic & Atmospheric Administration (NOAA) recently delivered its annual hurricane forecast for 2025 and the call is for above average storm activity as ocean and gulf water temperatures continue their rise. The NOAA calls for 13 – 19 named storms this year with 6 – 10 of those storms classified as hurricanes (winds exceeding 119 km/h). On the severe side of the spectrum, 3 to 5 of those storms are expected to be major weather events and have winds in excess of 180 km/h. Storm prone areas could be in for higher than normal activity this year and reductions in supports and infrastructure may only increase impacts towards affected regions. The debate on the existence of climate change continues but the insurance industry has felt the effects of those environmental changes first hand over the last decade as the intensity and frequency of damage causing weather events ramps up. This year’s hurricane forecast predicts above average activity in a time when just average activity causes substantial loss to both commercial and residential property and assets.

Direct Impacts to the Insurance Industry

The planet has experienced increasingly severe weather events over the last decade and costs related to damage continued to climb upwards in tandem. Insurable losses in 2024 came in at $137.36 billion USD (Swiss Re Group), outpacing earlier years and well over 2020’s total of $103.37 billion. According to Swiss Re, 2025’s forecast for insurable losses stands around $145 billion, auspiciously breaking out and over the linear trend. This year’s hurricane forecast provides support to increasing payout estimates as both the amount of predicted storms and their intensity are ratcheted upwards. While major weather events only happen during certain times of the year, it is up to the insurance business to mitigate the challenges of increasing costs during the entire fiscal period. Managing revenue streams, such as client monthly or yearly premiums, is a critical component in controlling costs and maintaining profitability. Insurance carriers and providers can make better premium valuation decisions with data based assessments that ‘paint a picture’ of a specific area’s current and past environmental landscape.

Key Data Points that Paint the Picture

Climate change is a complex subject that takes into account many different aspects of atmospheric composition and elements on the surface of the Earth. ClimAIteTRACK is a new insurance management tool that looks at critical data points that have a direct impact on property and asset damage in both the short and long term. By acquiring past and current weather data points, ClimAIteTRACK can identify climate trends for specific regions and deliver graded assessments that provide insight into past and future potential weather related damage and losses. Insurance businesses can better optimize client premium intake and offer decision transparency to clients that increases confidence in the individual while collecting additional premium revenue for the business. ClimAIteTRACK utilizes weather data points that represent physical weather elements that make direct contact with assets in both the commercial and residential property realms.
Advanced Analytics to Manage the Problem

Insurance companies have one major source of revenue in the collection of premiums paid for by policyholders. In the face of increasing operational costs and claim payouts, insurers need to highly optimize and manage premium intake to ensure those increasing costs are mitigated in some fashion. The changing environment is a main factor driving up insurable losses and using data analytics can provide more clarity and strategy when determining and ‘selling’ premium adjustments. ClimAIteTRACK collects and analyzes past and current weather data points of a specific area to create an Environmental Assessment Grade (EAG) that insurance businesses can use to internally set premiums or use within a Dynamic Premium Pricing Model (DPPM). The EAG can also be used to communicate rationale for premium adjustments with easy to understand client facing elements. ClimAIteTRACK uses propriatry formulas to establish the EAG and can be configured as needed by the particular insurance carrier. ClimAIteTRACK is a powerful tool for the insurance industry that delivers data driven climate assessments.

Severe Weather Continues in 2025

This year’s NOAA Hurricane forecast suggests higher activity than normal and the potential for more severe storms making landfall. Changes to climate, more specifically, increasing ocean and gulf temperatures, are contributing factors to the increase in frequency and severity of weather events. The insurance industry bears the most of the brunt for costs associated with damage and loss created by these weather events and managing revenue streams is more critical than ever as claims and operational costs increase in the current environmental landscape. Acquiring and analyzing specific weather data and metrics can be a useful tool in determining a specific area’s current environmental status and potential for risk. Insurance providers and carriers can better assess and establish client premiums while building client confidence through transparency by utilizing tools such as ClimAIteTRACK.