In 2021 the United States went through 22 separate weather and climate disasters that each caused at least a billion dollars in damage, according to the National Oceanic and Atmospheric Administration (NOAA). Hurricanes, floods, droughts and heatwaves are arriving more often and with more force, and the bills are following.
Storms and floods
Hurricane Ida cost an estimated $75 billion in damage across the US and parts of the Caribbean in 2021. Business interruptions and lost productivity can drag on for years after the wind drops.
Flooding costs the world about $100 billion a year, according to the World Bank. In 2020, floods in Germany and Belgium did more than $40 billion in damage. Water takes out roads and rail, ruins crops and leaves a repair bill for local and national budgets alike.
Drought and heat
Drought hits farms hardest. The US Department of Agriculture reported that the 2021 drought in the Western United States cost farmers and ranchers $8 billion. Yields fall, water costs rise and food prices follow.
Europe has its own benchmark. The European Commission said the 2003 heatwave caused 70,000 excess deaths and economic losses of around 13 billion euros, with the money going to extra cooling, health care and lost working time.
Insurers and infrastructure
Swiss Re put global insured losses from natural disasters at $82 billion in 2020. Insurers face more claims, and they are adjusting premiums and risk models to match.
The American Society of Civil Engineers estimates the US needs to invest $4.5 trillion by 2025 to improve its infrastructure. Infrastructure built to withstand extreme weather costs less to repair after the next event, the source argues.
The Intergovernmental Panel on Climate Change (IPCC) says climate change has already increased the frequency and intensity of these events. A NOAA study predicts that by 2050 the US could face annual costs of $1 trillion from climate-related disasters. The UN Framework Convention on Climate Change urges countries to put money into early warning systems and disaster preparedness.
