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The Aftereffects of Katrina on New Orleans

Today at TWI, we started running a series of stories on New Orleans five years after Katrina, trying to investigate some of the overlooked, unexpected

Jul 31, 2020
Today at TWI, we started running a series of stories on New Orleans five years after Katrina, trying to investigate some of the overlooked, unexpected consequences of the devastating hurricane. First up is Andrew Restuccia’s investigationof longstanding problems with landfills and trash disposal in the New Orleans flood zone. Dozens of other publications are also offering such explorations of the almost innumerable important consequences of the disaster. For instance, NPR has a descriptive piece on how the suicide rate has apparently doubledsince Katrina, even though the city’s population has dwindled:
“I just had been by this corner a thousand times, and I had never noticed it’s right there,” [one resident] says. “I feel like that’s what happens here. You don’t think about Katrina. You don’t notice Katrina. Then all of a sudden it’s right next to you.” Twenty-five cent martinis are an offer at Commander’s, and much of the city has been rebuilt. But traces of Katrina are still around.
One of those traces, some people argue, is the suicide rate in Orleans Parish. In 2008 and 2009, the rate of suicide was about twice as high as it was the two years before the levees broke. The rate of suicides in Orleans Parish has basically doubled.
A second, very different story focuses on how the cost of insurancefor buildings, homes and businesses has skyrocketed, slowing the recovery, though the government has tried to step in to help:
“Katrina obviously exposed the fact that the state is riskier than had been previously assumed,” said Robert Hartwig, who heads the industry-sponsored Insurance Information Institute. “Insurers look at models. The models suggest that we are in a period of heightened hurricane activity. Not just for one year or two years, but over the long run. That makes Mississippi and every other coastal state more vulnerable.”
Katrina cost insurance companies $45 billion in today’s dollars, he said. Claims for the entire year were $70 billion in today’s dollars. “In order to be prepared for years like that,” Hartwig said, “insurers simply have to charge a rate that reflects the risk.”
“It’s a re-evaluation of the risk, but it’s also a recognition of the risk. Katrina made it pretty obvious what that risk was.”
Critics contend the industry has overestimated that risk. Nevertheless, insurance rates continue to climb. The state’s willingness to work with insurers has helped the market, Hartwig and others say. Commercial rates, in particular, have declined from post-Katrina highs and coverage is more widely available.
Camilo Wood

Camilo Wood

Camilo Wood has over two decades of experience as a writer and journalist, specializing in finance and economics. With a degree in Economics and a background in financial research and analysis, Camilo brings a wealth of knowledge and expertise to his writing. Throughout his career, Camilo has contributed to numerous publications, covering a wide range of topics such as global economic trends, investment strategies, and market analysis. His articles are recognized for their insightful analysis and clear explanations, making complex financial concepts accessible to readers. Camilo's experience includes working in roles related to financial reporting, analysis, and commentary, allowing him to provide readers with accurate and trustworthy information. His dedication to journalistic integrity and commitment to delivering high-quality content make him a trusted voice in the fields of finance and journalism.
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