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Resiliency and preparedness are key to facing climate change

hail stone

Events in 2019 have made it clear that climate change has immediate, wide-ranging effects on every Minnesotan. For example, in August this year, WCCO-TV interviewed Tina Hansen as she was having her car evaluated for hail damage insurance coverage following a storm that included hail as big as baseballs. Her husband’s vehicle had been damaged too. And this was Hansen’s second experience with significant hail damage; her car had been hit in a hailstorm in 2017.

Minnesotans are familiar with hail, but it seems that hailstorms are getting more severe. The storm in June 2017 that swept through Blaine and Coon Rapids caused $3.2 billion in insured damage in Minnesota alone. Hail is just one cause of increasing costs. Flooding and heavy rain have harmed Minnesotans, too.

At the Minnesota Department of Commerce, we are working to build resilience and preparedness to face climate change today, because we know there is no alternative. At Commerce, we tell Minnesotans that we are “With You Every Day.” And we mean it. We are with Minnesotans when they are pumping gas, having their groceries weighed, opening a bank account or buying insurance.


We are seeing how climate change affects our environment, yes. But it also affects our homes, our health, our financial markets, our insurance policies and our future.

In Commerce’s Energy Division, we are hard at work to expand access to renewable energy opportunities and serve as a resource to help Minnesotans lower both their energy bills and their carbon footprint. We advocate strongly for the One Minnesota Path to Clean Energy, a set of policy proposals that will lead our state to 100% clean energy by 2050, because we know it is good for Minnesota’s economy, wellbeing and future.

Steve Kelley
Steve Kelley
We also know that the severity and frequency of weather events caused by climate change have a devastating impact on local governments and families in Minnesota. According to one reinsurance company, annual severe storm losses have exceeded $10 billion every year since 2008, a significant increase over previous years.

Insurers have responded by increasing deductibles for hail, seeking to exclude hail from coverage and other steps that shift the cost of hail damage to consumers. But it is Commerce’s responsibility to make sure Minnesotans do not pay excessive rates for insurance. We work closely with the insurance industry to understand these issues and make sure Minnesotans are prepared for the ongoing and increasing effects of climate change on our homes and our health.

Climate risks also bring serious financial risks. This spring, a branch of Frandsen Bank & Trust, the only bank in Oslo, Minnesota, was cut off from its community for a time because of flooding. If Minnesota farmers continue to experience crop failures caused by more volatile weather patterns, the harmful effects will ripple into rural communities and the state banks that serve them. Bank regulators in many industrialized countries are concerned that climate change or a disorderly transition to new forms of energy creates risks for the financial system. At Commerce, we’re working hard to identify the risks of climate change on the financial market so we can better help Minnesota’s financial system respond.


We know that the climate change discussion must include the companies and individuals we regulate, asking how they are preparing for the risks posed by climate change, as well as the risks that might be created by the transition to a new, carbon-free energy system. We also need to collaborate effectively with other agencies that also work on these issues. For example, the Housing Finance Agency and the Department of Labor and Industry play key roles in residential building design and construction. We will be working with them to ensure that energy costs, energy efficiency, insurance costs and other factors that affect the resilience of Minnesota families in the face of a changing climate are factored into policy decisions.

Climate Week is an occasion for Minnesotans to recognize the potential effects of a changing climate on many aspects of their day-to-day lives. I encourage Minnesotans to communicate to policy makers their expectation that we see the big picture of climate change, and that the health of our climate be integrated into the full scope of work we do on their behalf.

Steve Kelley is the commissioner of the Minnesota Department of Commerce. 

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