Water Damage from Katrina Seen at $44 Billion
Date: 30-Sep-05
Country: USA
Author: Jane Sutton
"While the flooding of New Orleans in the aftermath of the storm has garnered the most attention, we estimate that the devastating storm surge along the Gulf Coast, including southern Louisiana, was equally destructive," Dr. Jayanta Guin, vice president of research and modeling at AIR Worldwide, said in a news release.
The estimate includes both insured and uninsured losses, company spokesman Michael Gannon said.
"That is exclusive of wind damage. That is just water," he said. "A portion of this is obviously going to be insured."
The company gave the following breakdown:
New Orleans - $22.6 billion
Louisiana - $16.2 billion
(except New Orleans)
Mississippi - $4.4 billion
Alabama - $793 million
Florida - $32 million
The Boston-based company has not changed its previous estimate that insured losses from Katrina would be between $17 billion and $25 billion, Gannon said.
"However, that does not include the potential impact of demand surge, the upward press on prices on labor and material after a catastrophe," he said.
Storm surge is the water forced ashore by a hurricane and is highest to the right of the storm's center. The force of the water can knock buildings off their foundations and move them a considerable distance from their original locations.
AIR Worldwide said it used aerial images from the National Oceanic and Atmospheric Administration and digital elevation models to determine water levels block by block. Then it used its detailed exposure database to calculate the total property damage within the flooded area.
The company uses risk modeling to help insurance companies and governments gauge the losses they may ultimately have to cover.