What would happen if a class 5 hurricane hit New York city? According to Mr.Silver's calculations $16 Trillion worth of damage, that is $1.34 trillion dollars more than the U.S. GDP. Such an event could, especially in this economy, devastate the global economy. To be fair this possibility is a near impossibility, some say that a class 4 hitting the north-east is impossible. A more interesting case is that of Hurricane New England which made landfall in Long Island and passed within 40mi of Manhattan. That cost $45 Billion, if it had directly hit the city could according to the model cost $239 Billion. Such an event could easily push back into a deep recession.
What should also give pause is that several climate change models predict increased magnitude and frequency of extreme weather.
If this happened, the insurance and reinsurance companies would help cushion the blow. But yes the hurricane would still be a huge disaster for the whole world.
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