Hurricane Irene Damage: Storm Likely Cost $7 Billion to $13 Billion

Monday morning, thousands of workers were cleaning up the wreckage caused by surging floodwaters, uprooted trees and downed power lines. Philip Bediant told Bloomberg News  that the process could take weeks, pointing to the continued threat widespread flooding poses to the nation's electrical infrastructure.

Estimates for the total cost of the storm varied, but they were all in the billions. The Consumer Federation of America anticipated $5 billion in personal claims from wind damages and another $2 billion in flood damage and released a statement urging homeowners to be vigilant with their insurance companies as they sought coverage. Kinetic Analysis Corp. in Silver Spring, Md., estimated the damage at $13 billion. 

Major Damage, But Not Catastrophic

The total cost of the storm could be billions of dollars higher considering money lost from shuttered businesses, closed transportation and goods that sit idle on shipping lines. Insurers noted that while the damage to individual structures may not have been as severe as in previous storms, Irene affected a much larger number of buildings as it churned up the East Coast.

In a situation report released at 3 p.m. EDT on Sunday, the U.S. Department of Energy estimated that a little fewer than six million customers were without power. In Connecticut and Delaware, the proportion of people without electricity exceeded 40 percent. Nearly a million customers lost power in New York, but the damage there was less than what some had anticipated.

It could have been a lot worse in terms of storm surge, could have been worse in terms of the actual wind speeds, Bediant told Bloomberg News. It did not strengthen like they originally thought.

Despite the mountain of claims insurance companies will need to climb, some businesses involved in rebuilding could see a boost. Politico reported that the investment advisory firm Cumberland Advisors had raised its projections for fourth quarter GDP growth, citing an uptick in new construction jobs.

After a disaster, there's always a definite short-term increase, Mark Merritt, president of the crisis-management consulting firm Witt Associates, told Politico. There will be furniture bought, homes repaired, new carpet, new flooring, all the things affected by flooding.