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.

According to the author of the study -- Karen Pauli, a senior analyst with TowerGroup's Insurance research practice -- all interested parties must work in concert "to effect the long-term change needed to reduce the risk posed by today's catastrophe landscape."

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