The Moore American

Local News

May 1, 2013

Disaster dollars blunt impact

(Continued)

MOORE —

The burden of disaster recovery is growing. In the 1950s, disasters in the United States caused a combined $53.6 billion in insured losses, according to an assessment by the Wharton Risk Management and Decision Processes Center at the University of Pennsylvania. In the 1990s, losses reached $778 billion.

Driving up the costs are population growth and urbanization. In 2004, Florida alone had $1.9 trillion in insured assets along its high-risk coastal areas, according to the Wharton Risk Management Center’s report.

And the insurance industry is balking. Private insurers, stung by costs over the last decade, have stopped writing policies for some areas, or charge such high premiums that people decide to take their chances. Even the National Flood Insurance Program, which will run a $28 billion deficit after Hurricane Sandy, won’t insure against flooding in some areas.

Many assets aren’t insured, which places more of a burden on government recovery programs. Taxpayers paid out about 62 percent of the recovery costs of disasters between 2000 and 2008, the Wharton Risk Management center reported.

“You didn’t see the governor of New Jersey make a big deal about having only 30 to 40 percent market penetration for flood insurance,” after Hurricane Sandy, said Jeffrey Czajkowski, a research fellow at the Wharton center. He noted many people live where they could get flood insurance from the government but do not. “The other 60 percent should have insurance, and if they don't, why should they get fast aid?” he said.

The Federal Emergency Management Agency is the main source of disaster recovery funds. It’s also the primary source of money for preparedness, though groups like the Army Corps of Engineers also have budgets for preparedness projects.

In 2012, FEMA spent more than $7 billion on recovery. By comparison, it spent $2 billion on disaster preparedness for various events, including terrorism.

FEMA has drawn fire from Sen. Tom Coburn, R-Okla., for its slowness in paying out those funds; it has billions in unspent preparedness money on hand

Text Only
Local News
Hyperlocal Search
Premier Guide
Find a business

Walking Fingers
Maps, Menus, Store hours, Coupons, and more...
Premier Guide