How costly are natural hazards?

April 28, 2014
Flood in Meissen, April 2006. Credit: U.Herrmann, GFZ

Costs of natural hazards are at historically high levels, and show an increasing trend. Cost assessments of natural hazards often only cover direct costs and even these are assumed to be at least 50% higher than international assessments report. However, besides direct damage, also indirect damage is relevant. For example, the Thailand flood in 2011 shut down scores of factories and damaged global car manufacturing and electronics industries. But, an improved precaution requires better understanding of the total costs, which comprise besides damage also risk mitigation costs. Only like that an efficient risk management of natural hazards can be achieved.

An international group of scientists led by Heidi Kreibich (German Research Centre for Geosciences GFZ) has now for the first time suggested an integrated cost assessment in . In the current issue of "nature climate change" the group drafts the new cost assessment cycle.

"Cost-benefit analyses that exclude certain cost categories lead to sub-optimal decisions," Heidi Kreibich explains the approach, "The cost assessment cycle involves the continuous monitoring of associated with risk management, thus enabling the early detection of inefficient risk mitigation strategies." A close link between the cost assessment cycle and the risk management cycle lead to an improved assessment of the real costs and as such to a stable basis for an improved decision making in risk management.

The possibility to make better, more efficient decisions for natural hazard risk management will gain even more importance in view of global environmental change.

Explore further: Climate change altering insurers' risk assessment

More information: H. Kreibich et al. "Costing natural hazards", Nature Climate Change, Vol.4, 25.04.2014, pp. 303, DOI: 10.1038/nclimate2182

Related Stories

Climate change altering insurers' risk assessment

June 24, 2013

Climate change is creating more frequent and more unpredictable extreme weather events, forcing insurers to change how they assess the risk of natural disasters hitting a specific area, the Geneva Association think tank said ...

Outsmarting nature during disasters

February 17, 2014

The dramatic images of natural disasters in recent years, including hurricanes Katrina and Sandy and the Tohoku, Japan, earthquake and tsunami, show that nature, not the people preparing for hazards, often wins the high-stakes ...

Climate models underestimate costs to future generations

April 8, 2014

Future generations will have to pay more for today's carbon emissions than what governments across the world currently understand. The climate models used by policymakers around the world to estimate the economic and social ...

Recommended for you

Climate scientist hits out at IPCC projections

October 13, 2015

As a new chairman is appointed to the Intergovernmental Panel on climate Change (IPCC) a University of Manchester climate expert has said headline projections from the organisation about future warming are 'wildly over optimistic.'

'Bridge' fuel may escalate atmospheric greenhouse gas

October 13, 2015

While the U.S. Environmental Protection Agency (EPA) suggests there has been a decline in measurable atmospheric greenhouse gas emissions from fossil fuel use in the U.S. for the past seven years, a Cornell scientist says ...

Study sees powerful winds carving away Antarctic snow

October 13, 2015

A new study has found that powerful winds are removing massive amounts of snow from parts of Antarctica, potentially boosting estimates of how much the continent might contribute to sea level. Up to now, scientists had thought ...


Please sign in to add a comment. Registration is free, and takes less than a minute. Read more

Click here to reset your password.
Sign in to get notified via email when new comments are made.