Combined Damages from Gustav and Ike in Louisiana Could Reach $20B

Preliminary estimates of the combined total physical damage in Louisiana from Hurricanes Gustav and Ike range from roughly $8 billion to $20 billion, not including “temporary economic activity losses or damage to assets in the Gulf of Mexico,” according the Louisiana Economic Development Department.

The LED on Sept. 18 released an analysis of damage from the two hurricanes that impacted the state in September — Gustav made landfall on Sept. 1 in Terrebonne Parish and on Sept. 12 and 13 Ike’s storm surge battered most of the state’s coastline. Gustav, a strong Category 2 hurricane, “followed a northwest path into central Louisiana, causing widespread physical damage, power outages, and/or flooding across the vast majority of parishes in Louisiana,” the LED reported. Gustav “caused widespread minor and moderate physical damage across a broad swath of Louisiana, [while] Ike had a devastating impact on a handful of parishes in south Louisiana with little physical damage to the rest of the state.” Around 97,000 businesses are estimated to have been impacted by Gustav. Similar figures resulting from Hurricane Ike had not been released at press time.

The LED’s preliminary estimates of damage from Gustav, which the department says are “conservative” suggest around $4.5 to $10 billion in total insured and uninsured property losses. The figures break down as:

• $2.0-4.5 billion for homes, vehicles, and personal property
• $1.0-2.5 billion for commercial structures, property, and inventory
• $1.5-3.0 billion for other property (e.g., agriculture, timber, and fisheries losses; public infrastructure; public facilities)

The most heavily impacted parishes include Assumption, East Baton Rouge, Jefferson, Lafourche, Rapides and Terrebonne.

“The greatest threat facing companies statewide as a result of Gustav is business interruption due to the temporary displacement of employees, loss of electricity, and related issues.”

Cameron, Jefferson, St. Mary, Terrebonne and Vermillion were the parishes most heavily impacted by Hurricane Ike. Total property damages from that storm likely will come in between $3.5 billion and $10 billion, the LED estimated. The LED’s report, “Economic Impact of Hurricanes Gustav and Ike on Louisiana,” can be accessed online at www.louisianaforward.com/.