Source: John W. Schoen / NBC News
The ferocious hurricane that swamped New York City will almost certainly turn out to be one of the costliest storms on record. Given the scope and severity of the damage, it’s difficult to guess the costs from the fires, floods, wind and rain, but initial estimates of $30 billion to $50 billion may turn out to be too low. By comparison, the most expensive U.S. storm so far, 2005’s Hurricane Katrina, caused about $46.6 billion in damages.
The massive scope of the storm — at more than 900 miles across, Sandy was the largest tropical system ever recorded in the Atlantic Ocean — helps explain why the damage was so widespread. Slamming ashore in the most heavily populated region of the country, where 10 states have declared a state of emergency, means the storm could leave a measurable hole in this quarter’s growth, economist say.
Insured losses alone will run from $7 billion to $15 billion, according to an estimate published late Tuesday by AIR Worldwide, a catastrophe modeling firm. That does not include uninsured propertie and publicly owned infrastructure such as roads and bridges.
“The effect on growth for the fourth quarter will not be catastrophic but might still be noticeable, especially in an economy with little momentum anyway,” said IHS Global economists Gregory Daco and Nigel Gault in a research note.
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