The Majority of Consumers Worry They Couldn’t Afford the Cost of a Natural Disaster

52 percent of Americans who have been affected by a natural disaster were not as well prepared as they could have been.

Many Americans could be financially devastated by a natural disaster or emergency, with 54 percent of consumers fearing the consequences would be too costly to bear. More than a quarter (26%) of those Americans have serious doubts about their ability to recover financially.

While consumers are concerned about the state of their finances following an emergency, they are more optimistic about being prepared in general, according to the latest LowCostInsurance survey of nearly 2,200 Americans. Only 12% of respondents admit to being unprepared for any of six emergencies, ranging from hurricanes to floods to earthquakes. However, responses on the specifics of preparations indicate that many people's feelings do not match their actions.

More than one-quarter of Americans strongly believe they wouldn't be able to withstand the financial impact of a disaster

Fifty-four percent of consumers are concerned about their ability to cover the costs of an emergency or disaster, and more than a quarter (26 percent) are extremely concerned. Only 10% of consumers strongly disagree with the notion that they could not afford an emergency.

Millennials (aged 25 to 40) are the most concerned about the financial consequences of emergencies. This demographic strongly agrees that an emergency would impose a financial burden that could be prohibitively expensive. Gen Xers (aged 41 to 55) are the second most likely to strongly agree with this, at 28%, followed by Gen Zers (aged 18 to 24) at 21% and baby boomers (aged 56 to 75) at 19%.

The majority of Generation Zers strongly disagree that an emergency or disaster would have financial consequences that would be too costly for them to overcome.

Consumers who are worried they wouldn't be able to afford the financial impacts of an emergency or natural disaster

Source: LowCostInsurance survey of 2,173 consumers. Totals may not add to 100% due to rounding.

Twenty-six percent of all consumers are neither agreeing nor disagreeing that an emergency would be too expensive for them. This population segment is larger than the percentage of people who aren't concerned about the cost of a disaster. Uncertainty seeps into the insurance industry as well.

Eleven percent of those polled are unsure whether they have flood or earthquake insurance. In comparison to other generations, Gen Zers are the most likely to be unsure about their coverage (19%), followed by baby boomers (12%), Gen Xers (11%), and millennials (10%).

Furthermore, researchers discovered that 67 percent of homeowners in hurricane-prone areas do not have or are unsure whether they have a flood insurance policy, despite the fact that flood damage is not covered by standard homeowners insurance. Furthermore, coverage through the National Flood Insurance Program usually comes with a 30-day waiting period. Sixty-six percent of people living in earthquake-prone areas don't have or don't know if they have earthquake insurance.

More than half of people who have experienced a natural disaster weren’t as prepared as they could have been

23 percent of consumers have never been affected by a natural disaster. Not only is it more common for people to have been affected by a dangerous natural disaster, but a sizable percentage of people have been affected by more than one event.

39 percent of those who have been affected by a natural disaster wish they had been better prepared. While 48% were as prepared as they could have been, 14% were completely unprepared. Gen Xers were the most likely to be unprepared for previous emergencies (18%), while 54 percent of baby boomers — the highest mark of any demographic — were as prepared as possible.

Consumers are most confident in their ability to adequately prepare for extreme heat, regardless of whether they have experienced a natural disaster. Seventy-seven percent of Americans believe they can ensure their own safety, as well as the safety of their family and home, in the event of a heat emergency, with 37 percent feeling very confident in their ability to prepare. Seventy-two percent believe they can plan for bad winter weather.

However, only 62 percent of consumers expect to be prepared for other severe weather events. Consumers are relatively confident in hurricane and flood preparedness — 62 percent are confident they could ensure their safety after experiencing flood damage, while 60 percent are confident in a potential hurricane. If a tornado formed, 58 percent believe they could adequately prepare, while 46 percent believe they could adequately prepare for wildfires and earthquakes.

Although more than six in ten people believe they can protect their home and family in the event of a flood, only 17 percent believe they have adequate flood insurance.

Although relatively few people claim to be unprepared for most disasters, the percentage who have adequate emergency supplies is low

Only 12% of people say they would be unprepared to ensure their safety in any of the six emergencies studied. When asked for specifics about their preparations, however, consumers' responses reveal a disconnect between their emotions and their actions.

The majority of households (83%) have a working flashlight. A sizable proportion of people (76%) have a first-aid kit and three days' worth of food (71 percent ). Fewer people, but still more than half, have enough water for three days. However, fewer than half of people have an evacuation go bag (40%) or a generator (30%), which could make surviving a natural disaster more difficult.

Other responses indicate insufficient preparedness. When there are emergencies, 30% of people do not receive emergency alerts from local authorities. Forty percent have not received CPR training and do not live with someone who has. And 53% of people don't have a complete plan for what they'd do with their pets if they had to evacuate in an emergency.