This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Why Are We Having So Many Costly Disasters?

Global warming could raise risks in the future.

"The sea level has already risen on the East Coast in the last century, and it's expected it will continue to rise," Linkin says. "I think insurers have to be aware their risk landscape is going to change."

Rising sea levels bring higher storm surges and increased flooding risk when hurricanes make landfall.

Computer simulations of climate change suggest that dry areas will get less rain, and wet areas will get more, Linkin says. That will lead to more flooding in some parts of the country and more droughts in others. The drought that created ripe conditions for wildfires in the West this year was the worst since the Dust Bowl, Linkin says. But such droughts could become more common -- more like 1-in-20 or 1-in-10 year events, versus 1-in-75 or 1-in-100 year events.

Complexity increases risk

The growing complexity of how businesses operate has also changed the risk of losses. A disaster not only affects the businesses it hits directly, but the many businesses in other locations that depend on them for supplies. And because we are so dependent on technology, damage to computer systems and robotics wreaks havoc.

Insurers have to look at risk differently, says Andrew Castaldi, Swiss Re's senior vice president and head of catastrophe perils in North America. They must consider all the connections to an industry hit by disaster.

What can we do?

The federal government already gives money to states and local communities to prepare for disasters and mitigate hazards. The grants pay for a variety of projects, such as efforts to elevate buildings in flood-prone areas and stabilize soils to prevent landslides.

Research shows those efforts pay off, says Kathleen Tierney, director of the Natural Hazards Center at the University of Colorado at Boulder. But better planning and mitigation are needed to reduce losses.

2 of 3

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
AAPL $92.69 -0.59%
FB $119.49 1.40%
GOOG $711.11 1.40%
TSLA $214.84 1.60%
YHOO $37.23 0.79%


Chart of I:DJI
DOW 17,740.63 +79.92 0.45%
S&P 500 2,057.14 +6.51 0.32%
NASDAQ 4,736.1550 +19.0610 0.40%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs