Louisiana tops the list of U.S. states facing the highest risk of extreme weather losses, with homeowners there absorbing an average of $6.7 billion in annual damage, mostly from hurricanes. That is the headline finding from a new Cotality report released Wednesday, which uses a risk-scoring model to measure the severity and likelihood of extreme-weather perils across the country.
By the Numbers
The bottom line: financial losses from extreme weather are already in the billions for 30 states, and Cotality projects a sharp increase in those losses by 2050. Louisiana’s annual bill is projected to jump to $11.4 billion by mid-century, driven largely by increased inland flooding. Mississippi and Florida rank next in overall vulnerability due to hurricane exposure, with total losses expected to swell by roughly 62% and 54%, respectively, over the same period.
Investors will note that California and Texas currently post the highest absolute dollar losses — $18.2 billion and $11.5 billion annually — but Cotality’s model ranks states by the concentration of risk relative to their housing stock, not just raw totals. That distinction pushes Louisiana to the top.
The Disconnect Between Perception and Data
“When people think of extreme weather, they usually think of places like California, Texas and Florida, but the most severe concentrations of risk aren’t always where you’d expect,” said Dr. Howard Botts, chief scientist at Cotality. The model captures perils that fly under the national radar, including inland flooding in states such as West Virginia, which faces a growing toll despite its distance from the coast.
Even the 10 least-exposed states are not immune. Cotality estimates their losses will rise nearly 38% by 2050, compared with a 47% increase for the top 10 riskiest states. “It’s important to remember that ‘low risk’ doesn’t mean ‘no risk’,” Botts said. “Every state has its own mix of perils and resilience, but wherever a state lands in our ranking, weather losses are projected to rise.”
Insurers Retreating, Premiums Rising
The financial fallout is already reshaping insurance markets. Insurers are increasing premiums and, in some cases, exiting high-risk markets altogether, leaving homeowners more exposed. Flooding, hurricanes, and severe storms are expected to drive the bulk of financial losses nationwide in the coming decades, according to Cotality.
The figure that matters for homeowners: as losses climb, the gap between what policies cover and what events cost is widening. The Cotality model, released Wednesday, quantifies that trajectory state by state through 2050.
Sources
- Extreme weather
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Photo: Jocelyn Augustino (Public domain)
