If the deadly 1927 Great Mississippi Flood were to recur today,its economic destruction could hit $160 billion, a catastrophemodeling firm projects.

The study, conducted Newark, Calif.-based Risk ManagementSolutions and published on the 80th anniversary of the largestflood disaster in U.S. history, estimates that the losses would bebetween $130 and $160 billion.

According to the firm, almost two-thirds of this total would bea result of residential damage, and the other third would resultfrom damage to commercial and industrial properties. While therewould be some damage to all the states along the lower MississippiRiver, Louisiana would sustain nearly 40 percent of the totalloss.

RMS said that although the extreme river flows that created theepic Mississippi flood are rare events, its research suggests thatclimate change and global warming are already increasing thepotential for exceptional flows on great river basins, such as theMississippi.

This potential for increased flows, RMS said, has an impact onhow flood risk should be managed and how levees need to bemaintained and strengthened.

Robert Muir-Wood, chief research officer at RMS, warned thatwhile levees have been built stronger and higher since 1927, "thebed of the Mississippi River has also risen in many places."

Mr. Muir-Wood noted, "With stronger levees there should be fewerfailures, but as we saw in New Orleans after Hurricane Katrina,relatively short sections of levee failure can have trulycatastrophic consequences: the taller the levee, the greater thespeed and force of the flooding."

Currently, the report said, there are 220,000 National FloodInsurance Program policies covering $37 billion in exposure acrossthe 100 counties affected by the 1927 flood, representing about 16percent of the total exposure value.

In the event of a repeat of this catastrophe, around 84 percentof the loss would be outside the terms of insurance. This is ahigher dollar amount of uninsured loss than in Hurricane Katrina,according to the study.

The modeling firm said it is likely that private insurers wouldface significant pressure to pay part of the flood loss under theterms of fire insurance coverage, and they could be confronted withlawsuits claiming that damage was caused by levee failure, debrisdamage or contamination, rather than simply flood inundation.

RMS also imagines there would be significant political falloutfrom a disaster of this magnitude in the lower Midwestern states,as the majority of the people who live in the affected area wouldbe forced to relocate or live in temporary accommodations.

Two hundred and fifty persons died in the 1927 flood, whichpoured through parts of Arkansas, Illinois, Kentucky, Louisiana,Mississippi, Missouri and Tennessee, and it caused approximately$250 to $350 million in loss at the time.

According to RMS data, approximately 27,000 square miles wereleft underwater, ruining crops, damaging or destroying 137,000buildings, and causing 700,000 people to be displaced from theirhomes.

Patricia Grossi, senior RMS researcher, said as a result ofeconomic and social changes that have occurred along theMississippi River since 1927, "a modern-day event would not be justa regional economic catastrophe but a national disaster."

T he full report is online athttp://www.rms.com/Publications/1927_MississippiFlood.pdf