2018 Hurricane Storm Surge Damage Could Top $1 Trillion
Industry Update
May 31, 2018
Source: DS News
Additional Resource:
CoreLogic (The 2018 Storm Surge Report full report)
A newly released CoreLogic report estimates that 6.9 million homes could be at risk of hurricane storm surge damage in 2018, with more than $1.6 trillion in potential reconstruction costs at stake.
According to the National Centers for Environmental Information (NCEI), natural disasters caused more than $300 billion in damages during 2017, a year that encompassed several damaging hurricanes, as well as wildfires and mudslides in California. The $309.5 billion total for 2017 set a new record, easily surpassing the previous U.S. annual record cost of $219.2 billion from 2005, which included Hurricanes Dennis, Katrina, Rita, and Wilma. Could 2018 be even more damaging when everything is finally tallied?
The 2018 CoreLogic Storm Surge Report “examines risk from hurricane-driven storm surge for homes along the Atlantic and Gulf coastlines across 19 states, as well as for 86 metro areas.” The report sorts homes into five different risk categories: Low (homes affected only by a Category 5 storm), Moderate (homes affected by Category 4 and 5 storms), High (homes affected by Category 3, 4, and 5 storms), Very High (homes affected by Category 2, 3, 4, and 5 storms) and Extreme (homes affected by Category 1-5 storms).
CoreLogic explains, “Reconstruction Cost Value (RCV) figures represent the cost to completely rebuild a property in case of damage—including labor and materials by geographic location—assuming the worst-case scenario at 100-percent destruction.”
According to the report, the Atlantic Coast has more than 3.9 million homes at risk of hurricane storm surge, with an RCV of more than $1 trillion. This represents an increase of approximately $30 billion over 2017. On the Gulf Coast, more than 3 million homes are at risk, with over $609 billion in potential total destruction damage, a more than $16 billion increase over 2017.
Of the 19 states analyzed, Florida has the most potential for storm surge damage, CoreLogic reports, with more than 2.7 million homes at risk. Louisiana comes in second with more than 817,000 homes at risk, followed by Texas with 543,000 and then New Jersey with 471,000.
Florida also has the highest potential RCV, with CoreLogic estimating a potential $552 billion in recovery costs from storm surge damage. New York ranks second with more than $190 billion RCV, followed by Louisiana with more than $186 billion RCV, New Jersey with more than $146 billion RCV, and Texas with more than $103 billion RCV.
You can read more from CoreLogic’s Storm Surge Report by clicking here.
