Despite Risk, Hurricane Insurance Premiums May Drop

Two Category 5 hurricanes formed in the Atlantic this year and made landfall -- a first. Hurricane experts have warned for years that the U.S. rush to build homes and businesses on the coasts is a recipe for disaster, and Hurricane Katrina demonstrated the vulnerability of U.S. cities to damage by hurricane.

And yet, because no hurricane hit the U.S. last year, and none has so far this year, insurance premiums may drop another 10% -- on top of 20% reductions this year, according to a story in today's London Daily Telegraph. Insurance officials meet this week in Monaco and will estimate demand for next year's policies.

So, homeowners and businesses may be able to get cheaper insurance -- but that won't stop the experts from warning about building in the path of hurricanes. You may be able to recoup your losses, but the losses will come -- somewhere, sometime.

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