NU Online News Service, Oct. 22, 2:47 p.m. EDT

Increasing risk factors along the Gulf Coast, including climate change and continued economic development in disaster-prone areas, could cost communities more than $350 billion in economic losses over the next 20 years, a new study claims.

The study released by Energy Corporation examined the economics of climate adaptation along the U.S. Gulf Coast, accounting for assets across the coast in Texas, Louisiana, Mississippi and Alabama. Global reinsurer Swiss Re was a lead contributor to the study's research.

The study found that wind and storm surge damage already amounts to an average of $14 billion per year in the region. But severe climate change, economic growth and land subsidence "could drive up expected annual losses by up to 65 percent to an average of $23.4 billion [per year] by 2030."

The region can mitigate the impact by investing $50 billion in "cost-effective measures over the next two decades, such as improved building codes, beach nourishment and roof cover retrofits," the study noted. It indicated that Gulf Coast communities could prevent around $135 billion in annual losses over the lifetime of implemented measures if such action is taken.

Insurance could also help protect against losses, the study noted. "There are mainly four key risk transfer actions that can help address residual loss," a statement about the study stated. "These include increasing insurance by making premiums more affordable through physical adaptation measures, decreasing the prevalence of underinsurance through incentives that encourage updating of insured property values, promoting additional self-insurance, and transferring top-layer risk through catastrophe bonds and other instruments."

Special Reports /

Climate Change, Development Could Prove Costly For Gulf Coast

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