A geographer and urban planner from disaster-prone Florida, Zac Taylor understands deeply that climate risk is about more than hurricanes, floods and extreme temperatures. Climate disasters also take the shape of housing inequalities, displacement and financial market breakdown. “We must rethink how and where we live in a climate-changed world. But the question is: how will we organize and finance this transition, in a way that secures safe and affordable housing?”

It was the middle of the night in Rotterdam, and Zac Taylor was wide awake. More than 7 thousand kilometers away, Hurricane Milton was about to make landfall on the west coast of Florida, with Taylor’s hometown of Tampa directly in its path. “Hurricanes can be measured with great precision – you can measure wind speeds, direction, magnitude. What you can’t quantify is the stress of watching and waiting as a hurricane barrels towards people and places you love, knowing that life-altering impacts await many.”

Hurricane Milton’s impacts on Florida’s west coast were severe, causing several deaths, sustained power outages for millions and widespread devastation, with a disaster bill well into the billions of dollars. Milton struck Florida just a few weeks after Hurricane Helene also caused significant damage throughout coastal communities, with tens of thousands of homes damaged by storm surges in the Tampa region. “Debris from Helene’s flooding suddenly became a projectile during Milton’s windstorm. These back-to-back events have enormously complicated the recovery process for communities and individuals.”

Insurance crisis

Florida is no stranger to hurricanes, but climate change is making natural disasters more severe and more frequent. The damage lies far beyond ravaged homes and debris scattered across the streets, Taylor says. “Insurability is a serious threat to the resilience of Florida’s housing sector, and the state’s economy more broadly. An absence of affordable insurance has a negative domino effect. Homebuyers can’t get a mortgage without insurance. Without mortgages, home values decline. These lower values erode the tax base of the local government and the economy, which depends on a strong housing sector.”

For ten years, Taylor has researched how and why insurance has become central to the climate crisis in Florida. With trillions of dollars of real estate, the vulnerable coastal state leans heavily on insurance to finance disaster risk, explains Taylor. But continued development in vulnerable areas, growing climate-related insured losses, global industry trends and other factors are driving up insurance costs and pushing insurers out of the state at a concerning pace. “Without a strong private insurance market, a growing share of insurance policies – and financial risks – fall to the state. This has enormous implications for who gets protected, but also who bears responsibility for financing climate losses.”

Financially vulnerable households

Insurance market woes lead to growing housing affordability challenges, Taylor explains. “It is now common for households to pay the equivalent of several monthly mortgage payments for their annual insurance policy. And this cost is increasing sharply. For households with housing affordability issues, or living on a fixed income, this poses enormous financial strain. This isn’t just about having disaster protection or foregoing it: without insurance, those who borrow from a bank risk defaulting on their loan – and losing their home.”

The burdens of insurance affordability and availability don’t land equally in communities. Wealthy households often go without insurance, while renters are typically excluded from most disaster insurance markets, for example. “These market patterns fuel unequal forms of urban restructuring, long before and after a storm. I hear story after story about how these pressures are changing the social character of communities.”

Not a distant disaster

For Taylor, whose academic and personal background is rooted in one of America’s most climate-vulnerable regions, the crisis unfolding in Florida is not a distant disaster. And while it may seem like a far-away issue for most people in the Netherlands, climate risk is a very real concern here as well. “Climate change and extreme weather will put increasing strains on the water and soil systems in the Dutch delta. These pressures impact the resilience of the built environment, and with it several aspects of the financial system, from insurance to mortgage lending.”

“We already see intersections between climate risk, financial markets and housing in the Netherlands. In Rotterdam alone, there are several expressions of this, which pose questions for society,” Taylor says.

“Thousands of new homes are planned to be built in unembanked waterfront areas – will these flood risks stay manageable, and how can this risk be financed? At the same time, many existing neighborhoods face extreme heat, land subsidence, and waterlogging: who is impacted by these challenges, and what prospects are there to finance improvements in the environment? In both cases, how do we respond to the need for additional safe and affordable housing, without worsening displacement risks? These are questions we’re actively working on in collaboration with a number of researchers and societal partners.”

Beyond conventional thinking

According to Taylor, we need to push beyond the confines of conventional thinking. “Florida’s insurance crisis raises complex questions about how we, as a society, can adapt to climate change while also safeguarding fundamentals, like safe and affordable housing. This complexity runs deep: in many places, our political, economic, and social institutions are built around housing, around how and where we live. We need to recognize this, but also rethink it.”

Taylor’s research has continued to call for new approaches to connecting our finance systems with spatial planning and urban development in more integrated and future-oriented ways. To develop such new approaches, be it in West Florida or South Holland, Taylor works with a wide variety of public and private sector stakeholders. On a national level, Taylor co-leads the five-year Red&Blue research program focused on the Netherlands, and brings an academic perspective to the key climate adaptation working group of the Dutch financial sector.

Inaction isn’t an option

“A joint knowledge agenda on finance and climate adaptation is a crucial point of departure. In the coming years, we need to bring the best applied and academic knowledge we have in our society together to reimagine this puzzle,” Taylor says. “The transdisciplinary approach championed by Resilient Delta plays a vital role in enabling this exchange of insights and securing a pathway forward.”

Taylor reminds us that Florida offers a cautionary tale for the Netherlands. “It shows us that inaction isn’t an option. And it suggests we need transformative approaches to tackling climate resilience in housing and beyond. Now is the time to roll up our sleeves and to rediscover our joint purpose.”

DELTA STORIES | This is the first of our Delta Stories, a monthly series of interviews that brings together the stories and people behind our work on urban delta resilience.