What price tag for 2013's hurricane season?
Forecasters predict an above-average number of Atlantic storms. Too bad agencies like FEMA are going into 2013 short on funding.
Are you ready for another, costly hurricane season?
Researchers at Colorado State University released their 30th annual Atlantic hurricane forecast on Tuesday. And they're predicting an above-average season for 2013, between June 1 and Nov. 30, with 18 named storms, nine hurricanes and four major hurricanes.
The forecasters say there's a 72% probability of a major hurricane making landfall somewhere along the entire U.S. coastline this year, with a 48% chance of a big storm hitting the East Coast and a 47% chance of one landing along the Gulf Coast.
"All vulnerable coastal residents should make the same hurricane preparations every year, regardless of how active or inactive the seasonal forecast is," said Phil Klotzbach, who co-authors the forecast. "It takes only one landfall event near you to make this an active season."
And it only takes one hurricane coming ashore in the wrong place to tally up huge property damage and insurance costs.
Accuweather.com estimates the median amount of damage caused by an Atlantic hurricane hitting the U.S. at around $1.8 billion. The average overall cost of such a storm, however, is nearly $9 billion -- thanks to outsize expense from Hurricane Katrina's damages ($145 billion in 2011 dollars).
And then there are the direct hits, when a major storm slams big U.S. population centers, as in the case of Superstorm Sandy late last year. The National Oceanic and Atmospheric Administration (NOAA) recently said preliminary U.S. damage estimates Sandy are near $50 billion.
At the same time, government funding for responding to hurricanes and other disasters has shrunk due to sequestration and other economic considerations. The Federal Emergency Management Agency (FEMA) is requesting a $13.5 billion budget for fiscal 2013, which C-SPAN says is more than $364 million below FEMA's 2012 budget.
The agency's Disaster Relief Fund (DRF) is slated at $6.1 billion, or nearly $1 billion less than in fiscal 2012. But in testimony before Congress last month, FEMA Administrator Craig Fugate said about $3.7 billion of last year's DRF went to FEMA's response and recovery operations for Sandy alone. So, just one large storm in a vulnerable place this year can leave local, state and federal emergency organizations scrambling for essential funding.
And then, of course, there are insurance costs. NOAA says more than half of the total U.S. population lives near coastline, and that number is expected to keep growing.
"So if you live on the east coast and you’re still skeptical about getting hurricane insurance for your property," says Ryan Horch at Kapitall Wire, "it might be time to reconsider."
"And that means more revenue for insurance companies," he added. "If the hurricanes don’t happen (which looks unlikely), then insurance companies will have plenty of extra cash laying around which could lead to an increase in their value or returned to shareholders as a dividend increase."
Federal flood insurance coverage is also targeted for big rate hikes to be phased in over the next three to four years, according to the Associated Press. The biggest increases will be aimed at people living in high-risk areas and who have not raised their houses above flood levels.
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