The Disaster Issue — Where Insurers Fear to Tread

Anyone who’s been paying attention needn’t be reminded that even a post-tropical cyclone can cause major damage. That’s what Sandy was when she came on shore in New Jersey and devastated communities along the eastern seaboard. With winds reaching across an 1,100-mile geographic area, the storm caused damage as far away as Michigan, where storm warnings and high waves were posted for Lake Huron. Just how much are these events costing insurers? The current estimated total of the devastation according to the U.S. National Oceanic and Atmospheric Association (NOAA): more than $50 billion. While that number is still climbing, it’s still less than half the total costs of Hurricane Katrina, which came in at $108 billion and was the costliest hurricane in U.S. history.