Insurance wonks estimate that only about 1 in 5 homeowners in Harvey’s path currently have flood insurance, which means that those without coverage who suffered damage are going to have to dig deep — way deep — to repair their homes. Many will likely be forced to sell, if they can, and leave their communities.
All told, the immediate physical damages wrought by the storm itself pale in comparison to the long-term economic catastrophe it leaves in its wake.
A preliminary estimate from catastrophe-modeling company RMS suggests that the collective damage from wind, storm surge and flood damage could peak out at around $90 billion. Moody’s Analytics put the estimate between $45 billion and $65 billion in damages to homes, businesses and public infrastructure.
“I’m sure that’s going to go higher, but that’s our current estimate,” said chief economist Mark Zandi, adding that this figure does not include up to an additional $10 billion in lost economic output.
Harvey made landfall in Texas last Friday as a Category 4 hurricane, and has since lingered just offshore as a tropical storm, pelting the coast with heavy rains. It was the first major hurricane to make landfall in the U.S. since Wilma in 2005, ending a record 12-year period with no hurricanes of Category 3 intensity or higher reaching the continental U.S.
In just 4 days, many Gulf Coast areas were saturated with over 40 inches of rain, with peak accumulations of 51.88 inches over Eastern Texas and adjacent waters. Harvey is the wettest tropical cyclone on record in the contiguous U.S., flooding hundreds of thousands of homes, displacing more than 30,000 people, and prompting more than 13,000 rescues.
Yet despite these catastrophic figures, Loretta Worters of the Insurance Information Institute actually found an upside to the devastation: She told USA Today that storms like Hurricane Harvey convince people who had previously shrugged off the risk to their homes to buy policies.
“People buy coverage immediately after a storm, then it starts to drop,” Worters said. “Three or four years later, we’re back to where we started.”
So it appears that even the purported “upside” to Hurricane Harvey is of no real benefit in the end. Maybe that’s why they call it a disaster, Loretta.