The following story got a lot of attention when it was firstwritten following a presentation by Nicholas Coch, a coastalgeologist, at an Advisen conference in June.

It may apply more now with Hurricane Sandy bearing downon the Northeast—scheduled to make landfall somewhere alongthe Southern New Jersey coast and bringing with it the possibilityof significant storm surge and inland flooding.

The predictions of Coch, a professor at QueensCollege, are startling. Think it can't happen? Remember that stormsurge from Hurricane Irene (which actually was just a tropicalstorm when it made landfall in Northeast) came very close toentering the subway system, and officials right now are talkingabout the corrosiveness of salt water under New York City fromSandy's surge.

The industry may not be headed for bankruptcy from HurricaneSandy, but the city could certainly be “headed fordisaster.”

Industry 'Headed for Bankruptcy' When a Hurricane Hits New YorkCity

By Chad Hemenway,PropertyCasualty360.com

New York City could soon be home to the world's longestaquarium—housed in its subway system.

The comment from Nicholas Coch, a coastal geologist andprofessor at Queens College caused chuckles among the audience atAdvisen's Property Insights Conference on June 5.

The fact is, much of his presentation prompted laughter. Butalthough Coch uses plenty of humor in his presentation, thelifelong New Yorker is very serious about the vulnerability of NewYork to hurricanes, and he has been warning officials for manyyears.

His warnings at Advisen's conference were to insurers.

“The insurance industry is just headed for bankruptcy,” he says,“if you keep doing what you're doing.”

His aquarium quip was, of course, referring to storm surgeovertaking the subway system. The surge from Tropical Storm Irenenearly entered the subway grates last year—an occurrence that couldhave had a major impact on the electrical grid, he says.

The water will need a place to go, and it can only move west,into the city. Long Island forms a right angle, making New York“the most dangerous place in the world for storm surge,” sendingthe Atlantic Ocean directly toward much of New York's low-lyingfacilities and infrastructure—highways, airports and power plants,Coch warns.

New York City's demography and geography are perfect for maximumdestruction during a hurricane, Coch adds. And it doesn't have tobe what is known as a major hurricane of Category 3 orstronger.

“A Category 2 in New York is equal to a Category 4 inCharleston,” Coch says.

New York is low. It was built on rivers, and will be subject tofreshwater flooding as well as surge from the ocean. The valuationof potentially-affected structures is very high and its tallbuildings will bear the brunt of stronger winds. To get rich, Cochadvices, “buy plywood futures” before a hurricane hits NewYork.

New York is “headed for disaster,” and Coch thinks the city isdue. When it happens, the industry will truly be tested because theU.S. has yet to see a major hurricane hit a major city.

“You're focused on frequency when you should be focused on theconsequences,” he says. “Companies don't do homework. Do goodscience. Sooner or later we're going to run out of luck.”

The New York City area hasn't been hit by a hurricane since1938. Before that the city saw hurricanes in 1893 and 1821. Cochsays this is more proof a significant storm is in the city'sfuture.

“It's going to happen, by the law of averages,” hesays.

According to a new report from CoreLogic, the New Yorkmetropolitran area leads other metro areas in the highest number ofproperties, the highest total value, and the highest average valueper property at risk of storm surge.

Howard Botts, CoreLogic vice president, says Hurricane Ireneprompted the analtyics provider to highlight storm-surge exposurethroughout the United States.

“The summer of 2011 gave us some startling insight into thedamage that even a weak storm can cause in the New York City metroarea,” Botts says. “Hurricane Irene was downgraded to a tropicalstorm as it passed through New Jersey and New York City, but theimpact of the storm was still estimated at as much as $6billion.”

CoreLogic's analysis finds that more than 455,000 properties inthe New York metro area could be affected by storm surge from ahurricane of any strength. The total value of these properties ismore than $168 billion, with an average value of $369,178.