Is the Insurance Industry Trying to Justify Increases in Rates or Simply Justifying Leaving the Risk Business Along Coastal areas?  These questions came to my mind after reading an article in the February 2008 edition of Natural Hazards Review.  The article, Normalized Hurricane Damage in the United States: 1900-2005 , claims that by 2020 a $500 billion dollar hurricane loss could happen in South Florida.  Of course, those are in 2020 dollars — but that is off the charts compared to any previous loss. The study was made primarily by people working for the insurance industry.  Accordingly, some bias may exist and consumer activists may find my questions justified.  The $500 million figure seems surreal given the Katrina’s calculated damage was $156 billion dollars.  The study has two undeniable findings and conclusions.  First, the population along coastal areas has grown.  Thus, more property is in potential danger of hurricanes.  The most concentrated areas are South Florida, Tampa, and the greater Houston area.  All three areas have experienced significant population increases over the past century.  Second, the per capita wealth has also increased over that period.  Not only are more people and properties in harm’s way, these people have more and more expensive properties at risk.  In simple terms, we have more and better stuff to insure on an individual basis. These statistics are important.  Determining the amount at risk and the amount of available insurance is important to a community and state. Since we cannot expect people are going to move away from the coast, the obvious long term solution is better risk management.  The enforcement of building codes and stronger building codes are inevitable.