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Natural Disaster Essay Conclusion

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  • Direct Losses: Data Collection, Reporting, and Agency and Organizational Roles

    One step toward producing more complete loss estimates would be to assign one agency of the federal government to compile a comprehensive data base identifying the direct costs of natural disasters, as well as the individuals and groups who bear these costs. These data should be collected according to the framework described in Chapter 2, for each natural disaster exceeding a given dollar loss threshold. The U.S. Department of Commerce's Bureau of Economic Analysis appears to have the capabilities to compile such a data base, with considerable input and assistance from FEMA and other relevant federal agencies. Whatever agency is selected should be given sufficient resources to accomplish this assignment.

    The recommended loss estimate data base would be compiled from many sources, including organizations such as Property Claims Services and the Institute for Business and Home Safety (which compile data on paid insurance claims) and other federal, state, and local agencies. The assistance of relevant professional associations, such as the National Association of Insurance Commissioners, should be enlisted to obtain other relevant data. A synthesis report containing data on disaster losses should be published periodically, preferably annually. One way the federal government might make sure it receives at least the state and local data is by amending the Stafford Act, requiring the data to be submitted as a condition for future federal disaster aid.

    A related recommendation is for the federal Office of Management and Budget, with advice from FEMA, to develop annual, comprehensive estimates of the payouts for the direct losses (due directly physical damage) made by federal agencies. These data should be divided into at least four categories:

    1. compensation payments to individuals and businesses (including subsidies on loans to help cover disaster-related expenses);
    2. response costs;
    3. losses to government-owned infrastructure (including state and local costs that are reimbursed by the federal government); and,
    4. payouts from federal disaster insurance programs (with annual premiums shown separately).

    These data should be assembled for some historic period in order to provide information of trends of disaster losses and payouts. Such an effort is critical if the federal government and policymakers are to better plan for future disaster-related expenditures, including mitigation programs and activities.

    The largest current gap in direct loss data involves uninsured losses borne by businesses and individuals. These data might be obtained through post-event sampling (in large disasters) and extrapolating these losses from other data

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