Natural disasters, ranging from hurricanes and earthquakes to droughts and floods, can disrupt the lives of local citizens and cost
governments, companies, and individuals a significant amount of money. Larger catastrophes like Hurricanes Katrina and Harvey have wreaked havoc worth tens of billions of dollars.
Natural Disasters are Increasing in Frequency
Recent years have seen a rise in severe weather events, even though they have always occurred. 2020 was the sixth consecutive year in which the United States was hit by climate and weather disasters costing $1 billion or more, according to the National Centers for Environmental Information (NCEI).
There were 50 such catastrophes between 2018 and 2020, causing a total of $237.2 billion in damage. 119 climate and weather disasters cost $1 billion or more between 2010 and 2019, resulting in an average of $80.2 billion in damage each year. Only 59 billion-dollar events occurred in the previous decade (2000–2009), with an average cost of $52 billion.
Because the Earth’s average temperature has been steadily rising, the frequency of climate-related occurrences is likely to grow
in the coming years. 2020 was the second hottest year on record, according to the NCEI.
Who Covers the Costs of Natural Disasters?
Climate and weather-related disasters affect the economy both directly and indirectly. Damage to business buildings and houses and the need to restore roads and electrical lines are likely the most evident immediate expenditures. On the other hand, natural catastrophes have a less visible impact on local communities,
such as the interruption of companies due to property damage or the inability of workers to report to work. While various catastrophes may cause significant property damage and business disruptions, hurricanes have been the most costly calamities in modern history. In a short of days or even hours,
their combination of strong winds and heavy rainfall may wreak damage over a large geographic region.
Who Covers the Costs of Natural Disasters?
Climate and weather-related disasters affect the economy both directly and indirectly. Damage to business buildings and houses and the need to restore roads and electrical lines are likely the most evident immediate expenditures. On the other hand, natural catastrophes have a less visible impact on local communities, such as the interruption of companies due to property damage or the inability of workers to report to work.
the following sources are-
- Organizations that are not for profit
- Insurance firms that are privately owned
- money from the state and local governments
- HUD provided block grants to local governments
- The Small Business Administration (SBA) offered residential and business loans
The Bottom Line:
Individuals, state and municipal governments and National Flood Insurance Program recipients received compensation from the Federal Emergency Management Agency (FEMA). According to estimates, winter storms, power outages, and water shortages in Texas, Oklahoma, and Louisiana in February 2021 cost billions of dollars (the full cost is still being tallied). According to one estimate, the damage in Texas alone in February would likely exceed the state’s $19 billion in insured damages after Hurricane Harvey.
