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Don’t Think That Sandy Can’t Happen Again

We won't know for some time how damaging Sandy has been, but a little historical perspective is in order lest we think we don't need to prepare for such events in the not-too-distant future.

Annes
Annes Haseemkunju, EQECAT
It’s still far too early to assess the impact of Sandy in terms of both insured and overall economic losses. EQECAT's latest estimate is of $10-20 billion in total economic damages and $5-10 billion in insured losses, IHS Global Insight (Englewood, Colo.) has reported that total economic losses could range between $50 billion and $70 billion. Time will tell just how high Sandy ranks in destructive storms, but there is good reason to expect similar events in the future, based not on climate change but merely on the historical record.

Sandy was an enormous storm, with a diameter of 700 to 1000 miles, and it struck the New Jersey Coast and New York metropolitan area with storm surge of 13 to 15 feet and winds gusting to 90 to 100 mph, notes Annes Haseemkunju, an Oakland, Calif.-based atmospheric scientist with EQECAT. "Flooding was huge, and somewhat unexpected because of the storm's arrival coinciding with astronomical high tides," he comments.

While the degree of flooding was unusual, Sandy was probably not a "storm of the century," insists Haseemkunju. "We've seen such damage-causing events in the past," he says. "We'll find out as more information comes in, but this was more like a 15- to 20-year event, or possibly even less."

Only last year, Hurricane Irene caused $6 billion insured damages and economic damages as high as $15 billion. Others events in recent years have been in that ballpark, and within the century there have been hurricanes with higher overall economic loss estimates when adjusted to 2012 dollars. A hurricane in 1903 may have been more destructive, though it is hard to estimate the kind of damage it might have done had it struck today. But more is known about other storms that have struck the Mid-Atlantic coast since then, according to Haseemkunju. He cites the following storms:

Irene, 2011: $10-$15 billion

Floyd, 1999: $3-$5 billion

Gloria, 1985: $7-10 billion

Hazel, 1954: $20-$35 billion

Long Island Express, 1938: $20-$30 billion

[For more catastrophe coverage, see Sandy Update: Flood Insurance Program Under Siege.]

Anthony O'Donnell has covered technology in the insurance industry since 2000, when he joined the editorial staff of Insurance & Technology. As an editor and reporter for I&T and the InformationWeek Financial Services of TechWeb he has written on all areas of information ... View Full Bio

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