At War with the Weather
Overview
The United States and other nations are facing large-scale risks at an accelerating pace. In 2005, three major hurricanes—Katrina, Rita, and Wilma—made landfall along the U.S. Gulf Coast within an eight-week period. The damage caused by these storms led to insurance reimbursements and federal disaster relief of more than $180 billion—a record sum. Today we are more vulnerable to catastrophic losses because of the increasing concentration of population and activities in high-risk coastal regions of the country. The question is not whether but when future catastrophes will strike. Who should pay the costs associated with catastrophic losses suffered by homeowners in hazard-prone areas?
In At War with the Weather, Howard Kunreuther and Erwann Michel-Kerjan and their colleagues deliver a groundbreaking analysis of how we currently mitigate, insure against, and finance recovery from natural disasters in the United States. They offer innovative, long-term solutions for reducing losses and providing financial support for disaster victims that define a coherent strategy to assure sustainable recovery from future large-scale disasters. The amount of data collected and analyzed and innovations proposed make this the most comprehensive book written on these critical issues in the past thirty years.
About the Authors
Howard C. Kunreuther is Cecilia Yen Koo Professor of Decision Sciences and Public Policy at the Wharton School, University of Pennsylvania and Codirector of the Wharton Risk Management and Decision Processes Center. He is Co-Chair of the World Economic Forum's Global Agenda Council on Innovation and Leadership in Reducing Risks from Natural Disasters.
Erwann O. Michel-Kerjan is Managing Director of the Wharton Risk Management and Decision Processes Center and teaches in the Wharton School MBA program. He is Chairman of the OECD's Secretary-General High Level Advisory Board on Financial Management of Large-Scale Catastrophes.
Endorsements
“The authors have provided the ultimate institutional and theoretical analysis, and empirical reference source, for hurricane and flood risk insurance and mitigation. At War with the Weather will surely become a sine qua non of every researcher, corporate analyst, and state or federal policymaker, and will be extensively cited. A spectacular work.”
Mark J. Machina, Department of Economics, University of California, San Diego
“At War with the Weather provides a comprehensive introduction to, and analysis of, US homeowners’ insurance against hurricane risk. This excellent study of disaster insurance will be valuable to readers interested in insurance of hurricanes and other catastrophic risks.”
James K. Hammitt, Professor of Economics and Decision Sciences, Harvard University, and Director, Center for Risk Analysis
“This book will prove to be a very important contribution to this field for a long time to come.”
Robert E. Litan, Vice President for Research and Policy, Ewing Marion Kauffman Foundation
“At War with the Weather offers more than just a detailed plan for managing weather risks. It outlines a long-overdue comprehensive, disciplined theory of risk management that applies to all manner of catastrophes.”
Michael Chertoff, former U.S. Secretary of Homeland Security
“In At War with the Weather, Professors Howard Kunreuther and Erwann Michel-Kerjan and their colleagues present leading thinking in a data-driven analysis of the problem society faces in managing the risk of natural disasters. They analyze the dynamics of the market, including the significance of insurer regulation, and propose innovative solutions. This book is essential reading for anyone searching for solutions to the problem of financing large-scale catastrophes.”
Terri M. Vaughan, CEO, National Association of Insurance Commissioners
“This book will prove to be a very important contribution to this field for a long time to come.”
Robert E. Litan, Vice President for Research and Policy, Ewing Marion Kauffman Foundation
“This is a book you are going to want to read. The subject is important and the authors know what they are doing.”
Joseph B. Treaster, Knight Chair in Cross Cultural Communication at the University of Miami, former The New York Times reporter
“This wide-ranging and incisive volume provides telling answers to a compelling question: How should we control the risks and pay for the losses from weather catastrophes? The analysis, with extensive data and new insights, examines the roles of homeowners and regulators, of public and private insurance, and of financial markets in protecting the nation’s trillions of dollars of assets at risk.”
Richard Zeckhauser, Frank P. Ramsey Professor of Political Economy, Kennedy School of Government, Harvard University