The Pineapple Express, which carries an atmospheric river of moisture from the area around Hawaii, is hammering California with storms again. Los Angeles and San Diego may receive a foot of rain. Strong winds are pushing the Pacific Ocean ashore. Similar storms during the first three months of 2023 killed 22 people and cut power to hundreds of thousands of homes. Moody’s estimated the cost of similar storms was as high as $7 billion last year.
The Moody’s number was based on statewide damage. Storms damaged areas hundreds of miles north of LA, as far as San Francisco, from late 2022 until the end of March 2023. At the time Moody’s posted its estimate, editors of FloodList wrote, “The overall economic loss estimate is based on an event reconstruction using the Moody’s RMS U.S. Inland Flood HD Model and reflects property damage, contents, and business interruption, across residential, commercial, industrial, automobile and infrastructure assets.”
With each successive year, the expense problem is likely to become worse. Part of the rising cost is due to direct damage. However, another cost that can rise more quickly is that of insurance. Many California businesses and residents do not have flood insurance at all. ABC 7 in San Francisco reported last March, “FEMA statistics show only about 193,000 homes in all of California are covered by a flood policy — that’s less than 2%.”
The California flood insurance problem will worsen for residents and businesses as the cost of Pineapple Express storms increases. If Florida’s flood insurance problem is a reasonable financial model, the price of flood insurance may surge enough in California that it will not be affordable in many cases.
This is another example of how climate change affects other parts of the US with financial consequences in the billions of dollars, much of which cannot be recouped by homeowners or businesses.