Sandy more severe than Irene; interests tie storm to larger issues
The R Street Institute pointed to the damage from the storm as a reason against developing in risky areas. In a statement, R Street “suggested the storm should heighten awareness about the dangers of federal policies that encourage development in risk-prone areas.”
R Street Senior Fellow R.J. Lehmann speaks to the potential impact on the National Flood Insurance Program: “It appears likely that Sandy will exhaust the NFIP’s remaining $3 billion of statutory borrowing authority, meaning it will need to request more money from Congress to pay its claims.”
He adds, “In the short term, we would insist the NFIP use its existing authority to raise rates, buy reinsurance and issue catastrophe bonds, so that the private market, rather than taxpayers, assume the risk of these sorts of catastrophes in the future. Over the longer term, further NFIP reform must include phasing in actuarial rates for all policies, and possibly selling some of the NFIP’s 5.6 million policies to private insurers.”
