H OUSING N EWS R EPORT
May 2016
winds, floods, earthquakes and increasingly wildfires. According to Munich RE, storms and floods accounted for two-thirds of the world’s insured losses in 2015. Kunreuther said economic and insured losses from natural catastrophes such as hurricanes, earthquakes and floods worldwide have increased significantly in recent years. “A comparison of these economic losses over time reveals a huge increase: $56 billion (1950-1959), $93.3 billion (1960- 1969), $161.7 billion (1970-1979), 262.9 billion (1980-1989), and $778 billion (1990-1999),” wrote Kunreuther, co-author of At War With the Weather (MIT Press, 2009). “Catastrophes have had a more devastating impact on insurers since 1990 than in the entire history of insurance.” Natural Disasters Only Get Worse
Metropolitan Association of Realtors.
In Jefferson Parish, the average price of home was $201,000 in the last half of 2015, up 4 percent from a year ago, reports the Realtor group.
Counting the Cost of Calamities
The “10 Most Costly Insured Catastrophes” chart below reveals the most costly hurricanes in the United States between 1992 and 2012. Of these eight major hurricanes, seven have occurred since 2004. In 2005, threemajor Category 5 hurricanes — Katrina, Wilma and Rita — slammed into the Gulf Coast within a six-week period (two in Louisiana), costing insurers more than $10 billion for each calamity and over $180 billion federal disaster relief. Likewise, 2004 was a record-breaking hurricane season, with four hurricanes in Florida — Ivan, Charley and Frances and Jeanne — costing insurers $29 billion in insured losses.
New Orleans Home Prices Climbing
Since Katrina 11 years ago, home prices in New Orleans have been steadily rising. The average price of home in Orleans Parish was $356,047 in the last half of 2015, up 14 percent from $300,353 in 2014, according to the New Orleans
“Over the last two decades, there’s been an increase in the frequency and the severity of natural disasters,” said Donald L. Griffin, vice president of personal lines at the Property Casualty Insurers Association of America, an industry trade 10 Most Costly Insured Catastrophes Continued Next Page
Event
Cost (in Billions)
Area & Year
Victims Killed
$46.3
Hurricane Katrina 9/11 Attacks Hurricane Sandy Hurricane Andrew Northridge Earthquake
New Orleans, LA 2005
1,836 3,025
$35.5
New York, NY 2001
$26.4
New York, NY 2012 Homestead, FL 1992
97 43 61
$23.7
$19.6
Los Angeles, CA 1994
$16.2
Galveston, TX 2008 Gulf Shores, AL 2004 South FL, Yucatan 2005
Hurricane Ike Hurricane Ivan Hurricane Wilma Hurricane Rita Hurricane Charley
358 124
$14 $13.3
35 34 24
$10.7 $9.8
Lake Charles, LA 2005 Punta Gorda, FL 2004
SOURCES: Wharton Risk Center with data from Swiss Re and the Insurance Information Institute
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