Sandy’s Economic Impact

Sandy’s economic impact cannot be fully assessed yet, but by all accounts it is going to be the costliest storm ever in recorded history. Hurricane Katrina seems to pale in comparison with the monster storm. Initial estimates which range from$30 to $50 billion has turned out to be too low.

Homes and other properties were damaged by the monster weather system. Insured costs alone account for about $15 billion already. Here is a part of an article by John W. Schoen for NBC News, “Only a portion of Sandy-related losses will be covered. Some businesses and households may never recover their losses. Others will be long-term winners, using claim payouts to rebuild and make improvements.

But the process will inject tens of billions of dollars, money that otherwise would not have been spent, into the regional economy. The increased spending will produce ripple effects for companies supplying the products and services needed to repair the damage, from construction firms to car dealers.

The money to pay for all this will be drawn from the roughly $500 billion in capital accumulated by the global insurance industry through premiums collected in years past.”

You can read the full article here.

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