It’s been three years since Superstorm Sandy, regarded as a one in 500 year event, struck a dozen states in the Northeast. The storm’s size, a 1000 mild wide wind field, and record-breaking low pressure devastated parts of the Eastern seaboard. The storm’s effects were so severe, the New York Stock Exchange closed for two days, an event that hadn’t happened since 1888, according to the National Oceanic and Atmospheric Administration.
According to the Insurance Information Institute (I.I.I.), Sandy ranks as the third costliest storm in U.S. history with New York and New Jersey suffering the most damage and, as a result, the largest losses.
Causing an estimated $18.75 billion in insured property losses at the time ($19.3 billion in 2014 dollars), Sandy’s wrath is exceeded only by hurricanes Katrina (2005) and Andrew (1992), according to ISO’s Property Claim Services (PCS).
Close to 1.6 million insurance claims were filed in 15 states and in the District of Columbia, I.I.I figures reveal. More personal claims arose from Sandy—1,129,000 versus 193,000 for commercial claims—but commercial policyholders sustained greater insured losses at $8.9 billion versus $7.1 billion for personal claims. In addition, 258,000 auto claims accounted for $2.7 billion in losses.
With more than half of the claims filed in New Jersey and New York, insurers settled 93 percent of those claims, according to I.I.I.
Sandy-related insurance claims were also filed in Connecticut, Delaware, Massachusetts, Maine, North Carolina, New Hampshire, Ohio, Pennsylvania, Rhode Island, Virginia, Vermont and West Virginia.
Sandy ranks second in the most significant flood events by National Flood Insurance payouts. According to I.I.I., the $18.75 billion insured property loss figure excludes insured flood losses covered by the federal government’s National Flood Insurance Program (NFIP). The NFIP has paid out $7.94 billion in Sandy claims to date.
The storm was the 18th tropical cyclone to occur in the 2012 Atlantic hurricane season, as reported by the National Weather Service. The National Hurricane Center reported storm surges between 3.1 and 8.9 feet.
At least 117 deaths were attributed to Sandy in the U.S. The Red Cross reports that it distributed more than 7 million relief items, 17 million in meals and snacks and provided more than 74 thousand overnight stays in shelters.
A new report by Swiss Re, The Big One: The East Coast’s $100 Billion Event, compares Sandy to a major hurricane that wreaked havoc along the entire Mid-Atlantic and Northeast more than 200 years ago and suggests the storm could have been worse.
According to the report, “The 1821 Norfolk and Long Island hurricane made landfall on the coast of North Carolina with wind gusts above 156 mph and carved a path of devastation up and down the Eastern Seaboard, making subsequent landfalls in Delaware, New Jersey and New York.”
The report examines how the 1821 hurricane would impact the same region if it happened today.
Addressing the potential damage the report authors state, “Trillions of dollars of assets and infrastructure would lie in the storm’s path, much of it aging and along the coast. Using our in-house, proprietary tropical cyclone model we reconstructed the storm track, wind field and potential storm surge and concluded that a large area of the most heavily developed Eastern Seaboard would be exposed to hurricane force wind gusts.”
Storm surges, similar to Sandy, would flood New York City and powerful winds gusts over 100 mph would cause even more damage. In addition, “Norfolk, Virginia – home of critical US Navy installations – would be completely flooded. Coastal counties would sustain wind damage alone in excess of $ 1billion. Combined physical damage from both storm surge and wind would exceed $100 billion, while the storm’s total potential economic impact is on the order of $150 billion, which would make it the most costly hurricane to impact the United States.”
The 1821 storm, if it happened today, would cause 50 percent more damage than Sandy as well as an estimated $100 billion in property from storm surge and wind damage, according to the Swiss Re report.
According to the latest figures released by the Federal Emergency Management Agency, it has distributed $1.4 billion to disaster survivors, $11.6 billion to state, local and tribal governments and $770.5 million in hazard mitigation grants.
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