Billion Dollar Disasters
Costly weather and climate disasters have increased
The increase in Billion Dollar Disasters over time represents a combination of factors, including an increase in the magnitude and frequency of some kinds of hazards (flooding, extreme heat, a driving component of drought and wildfire hazards) and changes in the value and placement of assets and property.
From January 1980 through December 2021, the U.S. experienced 323 weather and climate disasters with overall damage costs reaching or exceeding $1 billion, including Consumer Price Index (CPI) adjustments, for each individual event. The cumulative costs for these 323 events exceed $2.195 trillion.
About Billion Dollar Disasters
The Billion Dollar Disaster indicator provides insight into the frequency and the total estimated costs of major weather and climate events that occur in the United States. This indicator compiles the annual number of weather and climate-related disasters across seven event types. Events are included if they are estimated to cause more than one billion U.S. dollars in direct losses. The cost estimates of these events are adjusted for inflation using the Consumer Price Index (CPI) and are based on costs documented in several Federal and private-sector databases.
In recent decades, the U.S. has experienced a rising number of weather and climate disasters that cause significant economic damages and societal losses. From 1980 to 2021, the annual average number of billion-dollar events was 7.7, including CPI adjustments. For the most recent 5 years (2017–2021), the annual average was 17.8 events.
2021 had the second-highest number of events (20) following the year 2020 that set a new annual record of 22 events. 2021 is the seventh consecutive year (2015-2021) in which 10 or more billion-dollar weather and climate disaster events have impacted the United States. Over the last 42 years (1980-2021), the years with 10 or more separate billion-dollar disaster events include 1998, 2008, 2011-2013, and 2015-2021 (Smith 2022).
The distribution of damage from U.S. Billion-dollar disaster events from 1980 to 2021 is dominated by tropical cyclone losses. Tropical cyclones have caused the most damage ($1,157.1 billion) and also have the highest average event cost ($20.3 billion per event). Hurricanes are responsible for slightly more than half (52.6%) of the total losses for all the U.S. billion-dollar disasters but represent approximately one-fifth (17.6%) of all the billion-dollar events we have assessed since 1980. In total, the direct costs for these billion-dollar disasters over the last five years ($764.9 billion) and the 5-year cost average ($152.9 billion/year) are at record-setting levels.
The increase in population and material wealth over the last several decades are important factors for the increased damage potential. Climate change is also playing an increasing role in the increasing frequency of some types of extreme weather that lead to billion-dollar disasters. Most notably, the rise in vulnerability to drought, lengthening wildfire seasons, and the potential for extremely heavy rainfall and inland flooding events are most acutely related to the influence of climate change (USGCRP 2018).
- In addition to direct threats to life and safety, major weather and climate disasters claim property, disrupt business, and affect daily life.
- All U.S. states, Puerto Rico, and the Virgin Islands have been impacted by at least one billion-dollar disaster since 1980.
- Climate change is playing a role in the increasing frequency of some types of extreme weather that lead to billion-dollar disasters.