Insurers going broke and a resultant national economic upheaval are "highly likely" unless state and federal governments, the public and insurers take steps to reduce the impact of catastrophe losses, according to a consulting firm analysis.
The study--by Needham, Mass.-based TowerGroup--calls for actions to halt growth in areas susceptible to natural catastrophe, reward disaster-resistant building, bolster insurer reserves and reinsurance backups, and improve flood coverage
It warned that unless there is a "concerted effort by invested parties to support a holistic solution to catastrophe management, the dire predictions of insurers' insolvency and general economic upheaval in the United States may come to fruition."
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