The Importance of Insurance

The Christian Science Monitor

August 29, 2011 Monday

Why insurance might not cover billions in hurricane Irene damage;

Damage estimates run in the billions for hurricane Irene, but with flooding the main culprit, a majority of damage will be items not covered by insurance claims, experts say.

BYLINE: Mark Trumbull Staff writer

LENGTH: 861 words

Hurricane Irene leaves in its wake an economic toll that includes inland flooding, power outages, and costly shutdowns of big-city transit systems.

Although Irene downshifted to a tropical storm before passing through New York City and beyond, damage could still total more than $5 billion, according to one assessment.

Among the storm's largest effects:

Floods in inland areas. From New Jersey to Vermont, Irene's torrents fell on a region that had already been saturated by thunderstorms in the week or so before. Many rivers won't crest for 36 hours or so, and important stretches of the Connecticut River not until Wednesday.Power outages. More than 5 million homes and businesses were without power from North Carolina to Maine on Monday, with no quick end in sight.Lost business activity. Consumers in America's most densely populated region hunkered in their homes instead of going to malls or movie theaters. Although the storm came on a weekend, its effects also spilled into the work week as some transit routes struggled to get running for commuters on Monday.

That's a partial list. Other losses include many homes damaged by surging surf or by wind and blown-down trees. Highway 12 in North Carolina was cut in several places. And in Tuxedo Park, N.Y., more than a dozen heating-oil trucks were swept into the Ramapo River as a stream overflowed, The Wall Street Journal reported.

It could have been worse

Despite all the losses, perhaps the most important point is what didn't happen. The region was spared from a much-worse toll due to Irene's weakened wind speeds.

"We were lucky," says Tom Larsen, a senior vice...