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Making America More Resilient toward Natural Disasters: A Call for Action

2013; Taylor & Francis; Volume: 55; Issue: 4 Linguagem: Inglês

10.1080/00139157.2013.803884

1939-9154

Howard Kunreuther, Erwann Michel‐Kerjan, Mark V. Pauly,

Tropical and Extratropical Cyclones Research

Click to increase image sizeClick to decrease image size Notes We thank our colleagues Karen Campbell, Jeff Czajkowski, Dena Gromet, and Robert Meyer, as well as the corporate partners of the Wharton Risk Center Extreme Events Project, for insightful comments. Carol Heller provided helpful editorial assistance. Support for this research comes from the National Science Foundation (SES-1061882 and SES-1062039), the Center for Risk and Economic Analysis of Terrorism Events (CREATE) at the University of Southern California, CRED at Columbia University, the Travelers Foundation, and the Wharton Risk Management and Decision Processes Center. 1. Aon Benfield, Annual Global Climate and Catastrophe Report: 2012 (Chicago, IL: Aon Benfield Impact Forecasting, 2013). http://thoughtleadership.aonbenfield.com/Documents/20130124_if_annual_global_climate_catastrophe_report.pdf 2. Munich Re, "Topics Geo. Natural Catastrophes 2012, Report" (Munich, Germany: Munich Re, 2013). 3.H. Kunreuther, R. Ginsberg, L. Miller, P. Sagi, P. Slovic, B. Borkan and N. Katz, Disaster Insurance Protection: Public Policy Lessons (New York, NY: Wiley, 1978). 4. R. Palm, M. Hodgson R. D. Blanchard, and D. Lyons, Earthquake Insurance in California: Environmental Policy and Individual Decision Making (Boulder, CO: Westview Press, 1990). 5. R. J. Burby, S. Bollens, E. J. Kaise, D. Mullan, and J. R. Sheaffer, Cities Under Water: A Comparative Evaluation of Ten Cities' Efforts to Manage Floodplain Land Use (Boulder, CO: Institute of Behavioral Science, University of Colorado, 1988). 6. S. B. Laska, "Floodproof Retrofitting: Homeowner Self-Protective Behavior" (Boulder: Institute of Behavioral Science, University of Colorado, 1991). 7. A. Goodnough, "As Hurricane Season Looms, State Aim to Scare," The New York Times, May 31, 2006. 8. E. J. Baker, J. Czajkowski, and R. Meyer, "Modeling the Real-Time Decision to Evacuate from a Hurricane," Working Paper, Wharton Risk Management Center, The Wharton School, Philadelphia, PA, 2012. 9. R. Burby, "Hurricane Katrina and the Paradoxes of Government Disaster Policy: Bringing About Wise Governmental Decisions for Hazardous Areas," Annals of the American Academy of Political and Social Science 604 (2006): 171–191. 10. C. Colten and A. Giancario, "Losing Resilience on the Gulf Coast: Hurricanes and Social Memory," Environment 53 (2011): 4, 6–19. 11. D. Kahneman, Thinking, Fast and Slow (New York, NY: Farrar, Straus and Giroux, 2011). 12. G. F. Loewenstein, E. U. Weber, C. K. Hsee, and N. Welch, "Risk as Feelings," Psychological Bulletin 127 (2001): 267–286. 13. H. Kunreuther, R. Meyer, and E. Michel-Kerjan, "Overcoming Decision Biases to Reduce Losses from Natural Catastrophes," chapter 23, pp. 398-413, in E. Shafir, ed., Behavioral Foundations of Policy (Princeton, NJ: Princeton University Press, 2013). 14. G. 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We also assume reconstruction costs to be stable over time. 20. P. Slovic, B. Fischhoff, and S. Lichtenstein, "Accident Probabilities and Seat Belt Usage: A Psychological Perspective," Accident Analysis and Prevention 10 (1978): 281–285. 21. N. Weinstein, K. Kolb, and B. Goldstein, "Using Time Intervals Between Expected Events to Communicate Risk Magnitudes," Risk Analysis 16 (1996): 305–308. 22. E. Johnson, J. Hershey, J. Meszaros, and H. Kunreuther, "Framing, Probability Distortions, and Insurance Decisions," Journal of Risk and Uncertainty 7 (1993) 35–51. 23. More recent building codes were established in 2004, then in 2007. See www.FloridaBuilding.org. 24. Institute for Business and Home Safety (IBHS), "The Benefits of Modern Wind Resistant Building Codes on Hurricane Claim Frequency and Severity—A Summary Report" (Tampa, FL: Institute for Business and Home Safety, 2007). 25. Institute for Business and Home Safety (IBHS), Rating the States: An Assessment of Residential Building Codes and Enforcement Systems for Life Safety and Property Protection in Hurricane Prone Regions (Tampa FL: 2012). 26. Insurance Institute for Property Loss Reduction, Homes and Hurricanes: Public Opinion Concerning Various Issues Relating to Home Builders, Building Codes and Damage Mitigation (Boston, MA: IIPLR, 1995). 27. Tax incentive programs such as this one should encourage homeowners to take out a larger deductible on their insurance policy and contribute more to the Catastrophe Savings Account. In the process they pay lower insurance premiums and lower taxes at the same time. The insurer benefits by having lower claims following a disaster. If many homeowners take advantage of this program by raising their deductible, the insurer's catastrophic exposure could be significantly reduced. 28. Under the Stafford Act, the federal government covers 75% of the losses to public infrastructure. 29. E. Michel-Kerjan and J. Volkman Wise, "The Risk of Ever-Growing Disaster Relief Expectations," paper presented at the annual NBER Insurance Group conference, Cambridge, MA, September 2011, http://nber.org/confer/2011/INSf11/Michel-Kerjan_Volkman_Wise.pdf. 30. E. Michel-Kerjan, "Catastrophe Economics: The National Flood Insurance Program," Journal of Economic Perspectives 24, (2010): 4, 165–186. 31. R. King, "The National Flood Insurance Program: Status and Remaining Issues for Congress," Congressional Research Service, 7-5700, R42850 (2013), p. 6, http://www.fas.org/sgp/crs/misc/R42850.pdf 32. E. Michel-Kerjan, S. Lemoyne de Forges, and H. Kunreuther, "Policy Tenure Under the U.S. National Flood Insurance Program," Risk Analysis 32 (2012) 4, 644–658. 33. W. Kriesel and C. Landry, "Participation in the National Flood Insurance Program: An Empirical Analysis for Coastal Properties," Journal of Risk and Insurance 71 (2004): 3, 405–420. 34. L. Dixon, N. Clancy, S. A. Seabury, and A. Overton, "The National Flood Insurance Program's Market Penetration Rate: Estimates and Policy Implications" (Santa Monica, CA: RAND, 2006). 35. More details on FEMA's Advisory Base Flood Elevations (ABFE) program can be found at http://www.region2coastal.com/faqs/advisory-bfe-faq 36. R. Repetto and R. Easton, "Climate Change and Damage From Extreme Weather Events," Environment 52 (2012): 2, 22–33. 37. H. Kunreuther E. Michel-Kerjan, and N. Ranger, "Insuring Against Future Climate Catastrophes," Climatic Change 18 (2013): 2, 339–354. 38. National Research Council. (2012). Disaster Resilience: A National Imperative. Washington, D.C.: The National Academies Press. 39. S.L. Cutter, J.A. Ahearn, B. Amadei, P. Crawford, E.A. Eide, G.E. Galloway, M.F. Goodchild et al. "Disaster resilience: A national imperative," Environment, 55(2013): 2, 25–29. 40. E. Michel-Kerjan, "How Resilient is Your Country?" Nature (2012): 491, 497. November 22. 41. E. Michel-Kerjan and H. Kunreuther, "Paying for Future Catastrophes," The New York Times Sunday Review, November 27, 2012.