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I.I.I. Estimates $50 Billion Insured Loss If Major Hurricane Hits Miami

A direct hit on downtown Miami by a Category 5 hurricane could cause up to $50 billion in insured losses and $80 billion in total damage, the Insurance Information Institute estimates. Some 10 percent of the businesses in the affected area would be shut down resulting in the loss of tens of thousands of jobs. Commenting on the 10th anniversary of Hurricane Andrew, I.I.I. said action to cut losses from the next hurricane vary and many communities have failed to deal with natural disasters in their land use plans.

Robert Hartwig, I.I.I. Chief Economist, said Andrew caused numerous smaller insurers to become insolvent and the market for residential and commercial property coverage in coastal areas of the state to dry up. Efforts to reduce losses through zoning restrictions or changes in building codes were often resisted by politically powerful developers and homebuilders, Hartwig added. Future construction, however, will be more resistant to hurricane damage as a result of the statewide Unified Building Code recently enacted by the legislature with the strong support of the insurance industry.