Mercury Insurance’s Climate Science Team Aims to Say ‘Yes’ to High-Risk Areas

Mercury Insurance, headquartered in Los Angeles, Calif., appointed Steve Bennett as its senior director of climate and catastrophe science.

In this new position, Bennett will build and lead a team focused on identifying ways Mercury and its policyholders can be more resilient in the face of increasingly severe climate-driven weather events.

Bennett has more than three decades of leadership in extreme weather, climate risk and risk management. He also serves on the adjunct faculty at the University of North Carolina at Chapel Hill, where he teaches and leads research for the Institute for Risk Management and Insurance Innovation. He was previously co-founder and chief scientist at Demex.

In a media statement, Mercury describes the creation of the climate science team as the latest in a series of investments aimed at understanding and counteracting forces facing insurance providers in high-risk areas.

“Climate change, population growth and resulting urban expansion has placed the insurance industry at a crossroads, resulting in many insurers pulling back from areas prone to wildfires, hurricanes and other catastrophic climate events. Mercury has taken a different approach to this challenge over the past year, working with homeowners, municipalities and government to create more resistant and insurable risks. The result has led to Mercury writing more policies in areas where its competitors have cancelled or non-renewed coverage for tens of thousands of consumers,” the statement say.

“Mercury is constantly looking for ways to say ‘yes’ to consumers, and to do that we are taking a science-based approach to risk,” Bennett said in the statement. “When customers do their part to harden their homes and communities from potential catastrophic events, we will do ours by extending affordable coverage options to those who may have difficulty securing policies.”

“I’m proud to be part of a larger Mercury vision dedicated to ensuring that investments in mitigation and smarter rebuilding translate into a healthier and more efficient insurance marketplace for everyone.”

In May 2024, the company announced that it would accept 12,556 home policies of Tokio Marine America and a subsidiary that planned to exit the California personal lines market. And on the same day that fires started in Southern California in Southern California in January this year, Mercury announced it would be the first major insurer to return to the northern town of Paradise, Calif. to write homeowners insurance. Paradise was the site of what was previously the deadliest and most destructive fire in California history—the 2018 Camp Fire. But Mercury pointed to the fact that the town was rebuilt to standards set by the Insurance Institute for Business & Home Safety to strengthen resistance to wildfire embers among factors supporting its decision to return.

“Mercury continues to develop a different approach to managing catastrophic risks,” said Victor Joseph, President and Chief Operating Officer of Mercury Insurance, in the statement about Bennett’s appointment. “We look at geography, prevailing wind patterns, building methods and materials, and policy concentration and apply this knowledge to individual risks. It’s not good enough to simply rule out entire ZIP codes. There are ways to significantly reduce risk even in the highest danger areas that would make these risks acceptable for Mercury.

Joseph said the lessons learned in Paradise helped Mercury to better understand the importance of all constituencies—individual homeowners, city, state and federal organizations, builders, urban planners and insurance companies—in reducing the risk of future catastrophes, adding the Bennett’s team “will strengthen Mercury’s ability to… and adapt to this complex equation, providing our company with a clearer understanding of the challenges posed by climate-driven catastrophes, while also helping our policyholders better prepare for these events.”

Source: Mercury Insurance