Articles | October 6, 2023

Know Your Hurricane Risk & Take Steps to Mitigate the Damage

Hurricanes are a well-known threat for the Atlantic and Gulf Coasts, but recent experience shows they can also hit the West Coast and U.S. islands.

Organizations, especially those based on the coasts of the continental U.S. or in Hawaii, Puerto Rico or the U.S. Virgin Islands, need to become aware of their hurricane risk — and the steps they can take, discussed in this article, to mitigate both human and financial damage in the event their geographic area is hit.

Construction Workers Installing Panels On A Building

This year’s hurricanes (so far)

The U.S. has already been affected by four hurricanes.

Hurricane Idalia was the strongest hurricane to hit the Big Bend region of Florida’s panhandle in more than a century. While Hurricane Dora didn’t directly affect Hawaii, its powerful winds spread wildfires in Maui, including the one that destroyed Lahaina. Hurricane Hilary was the first tropical storm to hit Southern California in 80+ years. It brought record-breaking rainfall and flooding to the Southwest. Parts of Massachusetts and Maine experienced torrential rains and high winds from Hurricane Lee.

The Atlantic, Eastern Pacific and Central Pacific hurricane seasons all last until November 30.

Hurricane projections

According to the latest predictions from the National Oceanic and Atmospheric Administration (NOAA) for the Atlantic hurricane season, above-normal level of hurricane activity is now expected.

The following table summarizes NOAA’s estimates for the number of possible hurricanes to expect, including the number that will be major. NOAA considers a tropical cyclone with maximum sustained winds of at least 111 mph to be a major hurricane (i.e., Category 3, 4 or 5).

2023 Hurricane Season Outlook

Region Hurricanes Major Hurricanes
Atlantic* 6–11 2–5
Eastern Pacific** 7–11 4–8

* NOAA press release, “NOAA forecasters increase Atlantic hurricane season prediction to ‘above normal’” (August 10, 2023)

** NOAA 2023 Eastern Pacific Hurricane Season Outlook (May 25, 2023)

Note: For the central Pacific hurricane region that covers Hawaii, NOAA predicts four to seven 2023 tropical cyclones, which include hurricanes, tropical depressions and tropical storms.

Source: NOAA’s Climate Prediction Center

Hurricane damage

In the U.S., hurricanes are the natural disasters that cause the most destruction. Hurricanes are becoming more damaging, according to research published in 2019.

The storm surges and heavy rainfall hurricanes bring can lead to flooding on the coast and even 100 miles inland and may create landslides. A hurricane’s powerful winds can damage buildings, uproot trees, down power lines and as noted above, even fan wildfires or trigger tornadoes in areas that are far from the eye of the storm.

In 2019, the Congressional Budget Office (CBO) estimated the annual economic losses to the commercial sector of the economy from hurricane winds and storm-related flooding to total $9 billion, which includes $3 billion of expected wind losses and at least $0.3 billion of expected flood losses. That estimate factored in revenue losses related to business disruption as well as the costs of repairing buildings and finding temporary space. The CBO further estimated that insurance claim payments would cover about 40 percent of the expected losses.

In July 2023, the nonprofit First Street Foundation published The 7th National Risk Assessment: Worsening Winds, which estimates an annual loss of $18.5 billion this year resulting from hurricane winds. That amount is projected to rise to nearly $20 billion in 30 years.

A flood can have a major impact even if it isn’t severe. According to the Federal Emergency Management Agency (FEMA), just a few inches of floodwater can cause tens of thousands of dollars in damage.

Know your risk

FEMA’s National Risk Index includes county-specific estimates.

Hurricane Risk by County

Hurricane Risk by County map

Source: FEMA, National Risk Index,

Expected Annual Loss from Hurricanes by County

Annual Loss from Hurricanse map

Source: FEMA, National Risk Index,

Take action if your risks of experiencing a hurricane and losses are high

There are several steps you can take to mitigate both human and financial damage.

1. Check your insurance coverage

It’s a good idea to review your property and casualty (P&C) insurance to verify if you are adequately protected in the event of a hurricane. Commercial insurance coverages do not always include protection from flood and wind damage. Some policies exclude hurricane-related damages.

Even if they do, in geographic areas that have a high flood risk, it may be prudent to purchase a stand-alone flood policy. If you have a mortgage, the lender can require flood insurance depending on your flood zone.

Segal offers a complimentary policy review to assess the appropriateness of your current commercial insurance and flood coverage.

As part of our review, we will:

  • Examine the types of coverage you have for your building(s) and their contents, including business income/extra expense coverage. While building owners will need both building and contents coverage, tenants need to ensure they have adequate flood coverage to cover their contents, such as office equipment.
  • Consider your claims data.
  • Analyze your limit of liability and deductible to determine if your policy could benefit from improvements in the scope of coverage.

As a leading broker for plan sponsors for decades, we have the experience to give you insights into coverage gaps and options for closing them.

2. Make a hurricane plan

As part of your organization’s hurricane plan, be sure to:

  • Educate your people on the importance of having their own hurricane plan. A helpful resource is the website.
  • Identify the team members who will oversee your organization’s response to the hurricane.
  • Protect vulnerable structures and equipment.
  • Check backup resources, like generators and secure cloud storage of your data.
  • Establish criteria for shutting down operations and evacuating the area.
  • Outline how you will communicate with your people, clients, vendors and insurers.
  • Set up a check-in system so your people can let you know that they are safe and whether their homes were affected.
  • Ensure your business continuity plan is up to date and addresses alternative operational business procedures that may be necessary in the event of a disaster.

Professionals from Segal’s Administration and Technology Consulting (ATC) practice and Segal Benz communications consultants can help you develop a hurricane plan.

3. Create a disaster recovery plan

Immediate disaster recovery needs may include working from alternate facilities, making repairs to existing facilities, replacing IT hardware, notifying customers and business partners and submitting insurance claims. The Occupational Safety and Health Administration has a Hurricane eMatrix that includes helpful information on common hazards and how to protect your recovery team.

A thorough disaster recovery plan should also cover communications about these relevant employee benefits:

  • Mental health support
  • Special leave programs that may include the option for unaffected people to donate vacation or leave time to those who were affected
  • Hardship withdrawals from defined contribution retirement plans

To keep your people and IT systems secure, it’s also a good idea for communications to include a reminder to watch for contacts from fraudulent “charities” that may seek “donations” and/or access to your system.

Keep in mind that after a presidential declaration of a disaster, the IRS, DOL and the Pension Benefit Guaranty Corporation usually extend contribution, filing and tax deadlines for benefit plans and participants the area(s) affected by the disaster.

Segal insurance brokers, health benefits consultants, ATC professionals, Segal Benz communications consultants and Segal’s compliance consultants can assist with these aspects of recovery.

4. Watch for long-term health issues

A 2021 article, “Perspectives on the Health Effects of Hurricanes: A Review and Challenges,” found that hurricanes cause and exacerbate multiple diseases. A person’s age, socio-economic status and pre-existing health conditions can modify or exacerbate the adverse health effects of hurricanes.

The paper also notes that while most adverse health impacts peak in the six months after a hurricane “chronic diseases, including cardiovascular disease and mental disorders, continue to occur for years following the hurricane impact.”

Segal’s Healthcare Informatics team can help you analyze your health plan data to identify patterns that can inform case and cost management.

How well is your organization prepared for a hurricane?

We can help you develop a hurricane plan and a recovery plan that meets your needs.

Contact Us

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This page is for informational purposes only and does not constitute legal, tax or investment advice. You are encouraged to discuss the issues raised here with your legal, tax and other advisors before determining how the issues apply to your specific situations.