CBO Report Estimates Damage from Hurricane Winds and Flooding Costs $54 Billion Annually

Industry News

April 17, 2019

CBO Report Estimates Damage from Hurricane Winds and Flooding Costs $54 Billion Annually

Losses to the U.S. economy from hurricane winds and storm-related flooding are expected to total $54 billion annually, according to a report from the Congressional Budget Office (CBO).

Approximately $34 billion in expected annual economic losses will be in the residential sector, $9 billion in the commercial sector, and $12 billion in the public sector.

The CBO estimates that the combination of private insurance coverage for wind damage, federal flood insurance, and federal disaster assistance would cover only about 50 percent of the losses in the residential sector and 40 percent of the losses in the commercial sector.

The report does not take into account damage from other types of storms, such as blizzards or tornados, or other types of natural disasters, such as droughts or wildfires.

The CBO makes five recommendations for lawmakers to reduce the expected losses from hurricane winds and storm-related flooding:

• Limit greenhouse gas emissions to reduce projected sea level increases, thereby lessening future storm severity.
• Increase federal funding to assess flood risks to help individuals and businesses make better decisions about where to locate.
• Expand purchase requirements for flood insurance and better align premiums with risks to improve the viability of the National Flood Insurance Program.
• Expand the federal role in risk mitigation to encourage greater use of risk-reducing measures in new construction.
• Increase the share of post-disaster assistance paid for by state and local governments to discourage development in vulnerable areas.

To read the entire report, click here.

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