Ida vs. Katrina: The early days

Ida struck New Orleans on Sunday, August 29, 2021, as a Category 4 hurricane. Katrina, on the other hand, was a Category 3 at landfall. There are multiple differences in these two storms, as well as the preparedness of the local area. Ida traveled through Alabama, and there are multiple reports of flooding across Louisiana. LaPlace, for example, has reported 1-2 feet of flooding. This was almost entirely caused by the storm surge pushing through Lake Pontchartrain from east to west.

Famous aerial photographs after Katrina showed the Superdome surrounded by floodwaters, which included the entire Warehouse District from the Mississippi River to the Superdome. Since Katrina was a Category 5 hurricane while in the Gulf of Mexico, it pushed a tremendous wall of water in front of it. Although it weakened to a Category 3 by the time it hit land, all of that storm surge was in front of it, which is why there was a storm surge of 25-30 feet in various areas of Louisiana. On the other hand, Ida seems to have topped out at about seven feet of storm surge, though we’ll know more in the coming days.

Katrina dumped up to eight inches of rain on various parts of New Orleans. Ida dumped up to 3-4 inches of rain per hour in various areas across Louisiana. Ida also was moving along at 15 mph, slowing to 10 mph as it made landfall. Katrina was a slower-moving storm, closer to 8-9 mph, allowing for more rainfall in concentrated areas.

I worked the Plaza Tower claim after Katrina, which is a skyscraper at the intersection of Howard and Loyola Avenue and only two blocks from the Superdome. It experienced floodwaters of about 15 feet inside the first floor of the structure. As the building was vacant before Katrina and was in the process of being sold, there was no power to the building, and so the trapped water quickly propagated mold growth throughout the structure. To further complicate matters, there was also asbestos and some lead-containing materials within the structure. Interestingly enough, the same insurer was the property carrier of record for both the buyer and the seller, so the claim was ultimately closed with minimal controversy.

Ida has provided quite a bit of wind damage, including blown over trees, downed power lines, torn off roofs, and flying debris damage. An open question will be to see how well the building codes and local construction practices complied with what we know to be “best practices” for wind-proofing various structures. Another nice thing about wind damage is that it is quite straightforward from a claim adjustment perspective. The only caveats are if there were sub-standard installation techniques used, or the age of the roof, to determine if full replacement value is warranted, or in the case of actual cash value replacement, the extent of the depreciation.

The aftermath of Ida will determine whether or not the $14.5 billion in infrastructure improvements could be considered successful. Since Katrina was considered a 100-year storm, the majority of hurricane events that might pose a danger to New Orleans in the next half-century will not likely reach a similar level. The major challenge to the levee infrastructure would be a much higher storm surge and the resulting damage. If a hurricane comes in with 25-35 feet of storm surge, that will be the ultimate test for the levee improvements.

For those adjusting claims back in 2005, the extent of damage due to storm surge vs. the damage due to wind was the major contention in some Katrina claims. It’s pretty clear when you have a storm-created opening, such as tearing the roof off, then interior water damage can be a covered event as well. However, if you only have water that gets into the building via leaky windows but not any actual storm-created openings, then your interior water damage is not covered. Storm surge is pretty easy to document because you will be able to see the water line on drywall to show the height of the flood within the structure.

Our thoughts are with the communities and families affected by this severe event and the first responders and insurance professionals as they descend on the area. We look forward to the incredible response that the insurance industry is known for to help quickly adjust claims and get policyholders back on their feet. We hope that this will turn out to be a much smaller disaster event and of much shorter duration than the Katrina recovery efforts.

Tim Christ is a vice president at Claimatic, a SaaS intelligent decisioning software that serves several P&C insurers. He is the author of two books on insurance, business and technology, a speaker at industry events, and a frequent contributor to various insurance publications. Contact him at tchrist@claimatic.com. The opinions expressed are the author’s own. 

Related:

• After Hurricane Ida — what happens now?
• Hurricane Ida insured loss estimate nears $18 billion in the U.S.
• Catastrophe management lessons from Hurricane Katrina