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INSURANCE INFORMATION INSTITUTE
Contact: Press Offices
New York: 212-346-5500; media@iii.org
Washington, D.C.: 202-833-1580

NEW YORK, August 25, 2008 - As the third anniversary of Hurricane Katrina approaches, it is a good reminder to consider whether you have the right type and amount of insurance coverage, according to the ̽»¨¾«Ñ¡ Information Institute (I.I.I.).

Hurricane Katrina, which struck the Gulf Coast on August 29, 2005, was the single largest natural disaster loss in the history of the insurance industry. ̽»¨¾«Ñ¡ companies paid $41 billion arising from 1.7 million claims for damage to homes, businesses and vehicles to policyholders in six states. By contrast, Hurricane Andrew, the previous record holder, produced $15.5 billion in losses in 1992 ($22.9 billion in 2007 dollars) and 790,000 claims.

"While 2005 was by far the worst year ever for insured catastrophe losses in the U.S., future storms could prove even costlier, reaching upwards of $100 billion," said Dr. Robert Hartwig, an economist and president of the I.I.I. "Disaster losses along the coast are likely to escalate in the coming years because of huge increases in development and rising building and repair costs."

The value of coastal property exposed to hurricanes increased by 24 percent, or $1.7 trillion, from $7.2 trillion in 2004 to $8.9 trillion by year-end 2007, according to AIR Worldwide. From December 31, 2004, through December 31, 2007, the insured value of properties in coastal areas of the United States continued to grow at a compound annual growth rate of just over 7 percent. Despite the recent weakening of the real estate market in many areas, the insured value-or the cost to rebuild properties-has maintained an annual growth rate that will lead to a doubling of the total value every decade.

(Total insured value of properties is an estimate of the cost to replace structures and their contents, including additional living expenses and business interruption coverage, for all residential and commercial property in the state that is insured or can be insured. Source: AIR Worldwide; I.I.I.)

Insured Value of Properties in Coastal States
In Alabama, the total value of insured coastal exposure increased by 21.9 percent, from $75.9 billion in 2004 to $92.5 billion in 2007. In Connecticut, the total value of insured coastal exposure increased by 18.5 percent, from $404.9 billion in 2004 to $479.9 billion in 2007. In Delaware, the total value of insured coastal exposure increased by 30.6 percent, from $46.4 billion in 2004 to $60.6 billion in 2007, the highest percentage change of all coastal states. In Florida, the total value of insured coastal exposure increased by 26.9 percent, from $1.9 trillion in 2004 to $2.4 trillion in 2007, the third highest percentage change of all coastal states. In Georgia, the total value of insured coastal exposure increased by 17.3 percent, from $73 billion in 2004 to $85.6 billion in 2007. In Louisiana, the total value of insured coastal exposure increased by 7.2 percent, from $209 billion in 2004 to $224.4 billion in 2007. In Maine, the total value of insured coastal exposure increased by 29.7 percent, from $$117.2 billion in 2004 to $146.9 billion in 2007. In Maryland, the total value of insured coastal exposure increased by 23.1 percent, from $12.1 billion in 2004 to $14.9 billion in 2007. In Massachusetts, the total value of insured coastal exposure increased by 16.7 percent, from $662.4 billion in 2004 to $772.8 billion in 2007. In Mississippi, the total value of insured coastal exposure increased by 15.9 percent, from $44.7 billion in 2004 to $51.8 billion in 2007. In New Hampshire, the total value of insured coastal exposure increased by 22.1 percent, from $45.6 billion in 2004 to $55.7 billion in 2007. In New Jersey, the total value of insured coastal exposure increased by 26.5 percent, from $505.8 billion in 2004 to $635.5 billion in 2007. In New York, the total value of insured coastal exposure increased by 25.1 percent, from $1.9 trillion in 2004 to $2.3 trillion in 2007. In North Carolina, the total value of insured coastal exposure increased by 26.1 percent, from $105.3 billion in 2004 to $132.8 billion in 2007. In Rhode Island, the total value of insured coastal exposure increased by 23.5 percent, from $43.8 billion in 2004 to $54.1 billion in 2007. In South Carolina, the total value of insured coastal exposure increased by 29 percent, from $148.8 billion in 2004 to $191.9 billion in 2007, the second highest percentage change of all coastal states. In Texas, the total value of insured coastal exposure increased by 21 percent, from $740 billion in 2004 to $895.1 billion in 2007. In Virginia, the total value of insured coastal exposure increased by 22.4 percent, from $129.7 billion in 2004 to $158.8 billion in 2007.