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10/10/07
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From the American Insurance Association:
Over the past decade, destruction from major natural disasters has increased at an alarming rate. As dramatic as these recent disasters have been, empirical data demonstrate that the magnitude of potential catastrophe losses will be even larger in the future.
Insurance losses from catastrophes (adjusted for inflation) have doubled every decade for the past 50 years. Computer models now estimate that the probable maximum loss (PML) to the insurance industry from a single hurricane could reach $86 billion, and the earthquake PML could exceed $100 billion.
These computer models also indicate that there is a 25% chance that the U.S. will experience a single disaster exceeding $10 billion in insured losses in any future year. Population growth in catastrophe-prone areas is continuing. More and more Americans are moving within 10 miles of the Atlantic, Pacific, or Gulf coasts.
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