A resilient reality for the 2026 hurricane season

Transcript:

Allie Barefoot: Welcome back to Data in Context. I'm Allie Barefoot with Cotality. There seems to be a massive shifting challenge in the housing and insurance markets: the true cost of hurricane risk. Across the U.S., there are over $12 trillion exposed to this natural hazard, according to Cotality's 2026 Hurricane Risk Report. That is, of course, the final bill if all at-risk homes were completely destroyed. But depending on the year, homeowners and insurers have to shoulder reconstruction costs to the tune of billions of dollars.

But the real story this year isn't just the sheer size of the numbers. The data shows that hurricane threats are expanding far beyond traditional coastal danger zones, leaving nearly a million homeowners underinsured and exposed to catastrophic flood risk. So, to look beyond the numbers and see how this really affects people, we're going to be talking today with Cotality's Chief Scientist, Howard Botts, to unpack the hurricane and flood risk of this year. Let's put the data into context.

Allie Barefoot: Welcome back to Data in Context, Howard. Very excited to have you here.

Howard Botts: Oh, I'm excited to be here. Thank you, Allie. I always enjoy our conversations.

Allie Barefoot: As do I. And as you know, hurricane season for 2026 is officially here. So I wanted to have you on to kind of set the scene, as Cotality's recent Hurricane Risk Report found over 32 million homes are at a moderate or greater risk for hurricane damage. That's an eye-popping number. But what does that really mean? What does hurricane risk look like across the United States?

Howard Botts: Yeah, that is an eye-popping number, and that would assume that hurricanes were striking along the entire Atlantic and Gulf Coastal areas. And obviously, in any single year, hurricanes impact different areas along the coast. And I think what we're looking at in the 2026 hurricane season is one of slightly lower hurricane risk, but it doesn't mean there is no risk. The numbers are just slightly decreased from what we would see in a typical year. There's still a very strong chance that a major Category 3, 4, or 5 will strike somewhere in the U.S.

And that variability is basically, if we look at it at a state level, Florida always ends up as being the number one likelihood—there's a 74% chance that's estimated that one will hit Florida, 46% in Texas, 40% in North Carolina, 40% in Louisiana. Those are always the—it seems like the top destinations for hurricanes. But in an El Niño year, you know, things change slightly because we have winds being pushed more southerly, which often means that hurricanes can start to be generated on the northern side of that jet stream. And so there are possibilities of hurricanes striking much further north. And the worst-case scenario would be another Hurricane Sandy, where we see a storm moving right along Long Island Sound, pushing a tremendous amount of storm surge onto Connecticut, New York, New Jersey areas. So, low risk doesn't mean that we're free and clear here, and by no means are El Niño events an impenetrable barrier to the formation of hurricanes.

Allie Barefoot: Yeah, I'm very interested in how El Niño will affect the Atlantic hurricane forecast in Florida because I live in Texas and, to be quite frank, it has just been wet. It's been raining, I've been seeing more and more storms than I have in recent years, and it seems very unusual for us. But I do have to take a step back and realize that this year is an anomaly, and it's not the ENSO, which is—or the El Niño Southern Oscillation—cycle shifting weather patterns permanently. But can these cycles affect property risk long term?

Howard Botts: Oh, absolutely. And you know, the first thing we need to understand is all of this is created by sort of thermodynamic impacts or heat. And as you in Texas have discovered, every year, every month seems to be, in large part, hotter than previous years. And so, you know, I think we're going to see this impact of rapid storm intensification, you know, greater impacts from hurricanes continuing well into the future.

That said, a typical El Niño, the major effects they have is to change the tropical trade winds, and it tends to shift the jet stream further south across the U.S. And so, that in part—the start of this—has brought you a lot more moisture, and we expect greater levels of precipitation across the Southern U.S. And certainly, we're going to see significant rain events, and that will bring greater variability in hot and cold days. Just a couple of weeks ago, it was 95 in New York City and snowing in Montana. [laughs] And so, this variability you referenced is here for the long run. But the one thing that we are going to see is this southerly jet stream basically acts to cut off the tops of hurricanes before they can form. Basically, it creates a wind shear and makes it very difficult, and does dampen down the numbers. But that, taken in totality, we can definitely expect more variability in heat, flooding, wildfire risk, drought, and severe convective storms during an El Niño.

Allie Barefoot: And there's a lot of forecasts about the hurricane season underway, but we're also tracking hurricane risk here at Cotality. And one of the most eye-catching and headline-grabbing findings in the early 2026 Cotality Hurricane Risk Report is when people think of hurricanes, they think of Florida or the Gulf Coast like you just mentioned. But our data reveals a completely different region actually holds the highest national ranking for home vulnerability. Can you break that down for us a little bit?

Howard Botts: Yeah, that is, I think, a surprise when most people see the number you're referencing. At Cotality, we track hurricane and storm surge risk across 20 states and major metro areas and quantify the numbers of homes at risk and reconstruction value. And across those 20 states, we see about 32 million homes at risk for wind damage and about 6 million homes for hurricane-driven storm surge in coastal and low-lying areas.

The surprising number you're referencing is New York City leads all of the metro areas in terms of wind risk—over 3.2 million in the New York metro area, almost $2 billion in reconstruction value related to wind. That's a pretty impressive number. And in terms of storm surge, a little over 600,000 homes and about $329 million at risk. One of the reasons, of course, is just residential density in that area, the amount of coastline—you have both Long Island Sound, you have coastal areas. And that's certainly being recognized by this area. Even though this is perhaps a low-frequency event, it certainly, when they hit, is a very, very high severity.

Allie Barefoot: Now, that's sort of at the metro level, but looking at the state level—obviously New York being a little bit of a surprise there in the report—Florida still retains that heavy crown, correct?

Howard Botts: Absolutely. And as we talked a little earlier, if a landfalling hurricane hits, there's a very high probability it's going to be Florida, with both her Gulf and Atlantic coastlines. And we estimate over 8.2 million homes at moderate or greater risk for wind-driven damage, and that equates to about $2.5 billion, assuming all these homes were hit. If we look at coastal surge, this is where the numbers really get quite high in Florida: almost 2.5 million—four times almost what the next leading state, Louisiana, would hit. And so when we look at wind and storm surge damage, Florida, like always, leads the list, followed by Louisiana, Texas, New York comes in fourth, and continues down to you get some place like Washington D.C., and only 470 homes are at risk for surge. So, they're relatively better off than these other states.

Allie Barefoot: We're talking a little bit more here beyond wind and storm surge risk. Cotality's 2026 Hurricane Risk Report spends a lot of time showing that standard flood maps don't always capture the full picture of flood risk across the country. What exactly leaves these areas off of the map, and how many homeowners are caught in this gap?

Howard Botts: Yeah, this is a significant risk and one that worries all of us that model flood. Beginning in the 1960s, going way back, private insurers stopped writing flood insurance because they didn't have a good handle on risk. So the federal government stepped in and created the National Flood Insurance Program.

And the decision at the time was, well, let's create a 100-year flood zone, which represents a 1% annual chance of flooding. And with those, anybody that has a federally insured mortgage would be required to get flood insurance. But outside that 100-year flood zone, purchase wasn't mandatory.

And as you alluded to in terms of granularity, historically, 30-meter grid cells—you know, almost 100 by 100 feet—were often used to model whether these homes had risk or not. We at Cotality go right down to 1 meter or so of elevation resolution. We also track first-floor height of all homes. So having water on a property doesn't necessarily imply that it's going to get into the home. And, you know, the risk is that homeowners outside the 100-year flood zone often think they're free of risk. Or they may think their homeowners policy covers them for flood risk, which is not true. And, you know, we found that over 927,000 homeowners are at risk from hurricane-driven flooding that are likely not insured. And that is a very scary and troubling number. You know, as I mentioned, we can go right down to the structure level, and we can estimate every home's flood risk. And I think that will really be the future of flood modeling, where individual homeowners can really understand what the likelihood of hurricane-driven storm surge or hurricane-driven flooding will likely mean for a particular house.

Allie Barefoot: Nearly a million homeowners might have no idea that their home could be flooded by a major storm because a map told them they didn't need flood insurance. When we look at structural vulnerability, the report points to a massive physical problem. How bad is the structural gap really on the coast and inland?

Howard Botts: Well, I think the major issue we're facing year-in and year-out in the U.S. is uninsured losses from flood. And whether that's flood caused by saltwater from a storm surge, or heavy downpours, hurricane-driven, that are some distance from the coast, or just very heavy pluvial or flash flood events. And most homeowners, I think, significantly underestimate the risk. And if you're living in a 100-year flood zone, which represents a 1% annual chance of flooding, you're required by your federally insured mortgage to have flood insurance. Although that doesn't necessarily mean that you're going to be fully insured if it's a very expensive home. But if you're someone in that flood zone that no longer has a mortgage, you're not required to have it. And if you're outside the flood zone, there's no requirement outside the 100-year flood zone.

And that is where we're seeing more and more risk coming from these major flood events we're having, whether they're hurricane-caused or just major precipitation events. And as you suggested, from hurricanes alone, you know, the number's over 900,000 people at risk that aren't insured for flooding. And we see that across both the Atlantic and Gulf Coastal areas, and that is a huge problem that most people don't realize. And they have the opportunity to buy flood insurance from the federal government at a reduced rate, but most Americans assume either erroneously they're covered by their homeowners policy, or think that the risk because they're outside that 100-year flood zone doesn't exist.

Allie Barefoot: And Howard, while our discussion so far has focused on the massive $12.26 trillion real estate exposure here across the U.S. The 2026 report reminds us that tropical cyclones are a high-stakes global reality. So what does the modeling tell us about how these international risks are shifting, and is this a worldwide phenomenon?

Howard Botts: Well, as we enter these various cycles between El Niño and La Niña, we see different parts of the globe generating much higher risk. And certainly during El Niño years, Pacific Ocean regions definitely have a much higher risk of tropical cyclones. And as any annual loss numbers show us, international typhoon risk is quite high, and we've seen major typhoons hit places like Japan, Korea, China, the Philippines, Thailand, Vietnam, and Malaysia. And our loss numbers from our hurricane models and independent sources show that these areas have very high risk. A lot of that is being driven—the atmosphere's getting warmer, storms are rapidly intensifying, and having a significant international impact, you know, across the Pacific and on the far western side for these countries I mentioned.

Allie Barefoot: For my last question I have for you here, Howard, is to talk about recovery. The report shares some incredibly stark data about the financial cost of delaying post-storm cleanup and mitigation. If a storm hits, time matters, but time really is money here. Can you explain why that recovery process matters so much?

Howard Botts: Absolutely. And you know, we're in a great position here at Cotality because we support the majority of remediation companies across the country. And you know, we get a lot of reports back as to how time does impact overall cost of remediation. And you know, I think what we've found is, you know, for hurricanes in particular, it's water damage. And the longer you wait to remediate against water damage, the greater the dollar losses are.

And when you're talking about places like Lake Charles, Louisiana, or Houston, they have some of the highest humidity levels in the country. And if you haven't secured your home—tarped over holes in the roof or patched up windows that may be broken—that humidity can certainly enter the structure as well as the water inside the house. So keeping water out, drying property out quickly reduces the chance of mildew, structural rot, and alternative living expenses—having to have a home that's uninhabitable because of black mold. And we found that if you wait a week to get in there, the cost of remediation goes up about 60%. If you wait three weeks, it can be as high as 200% greater. And so that damage just keeps increasing exponentially. So it's really key to get a tarp on that roof right away, or to get fans in your house to begin drying it out as quickly as possible. So, to quote you, time is money. And particularly if you're uninsured, that becomes really a critical issue getting in there quickly and remediating all of these post-storm cleanup needs that you have.

Allie Barefoot: Right, taking those steps now so that down the line you've created less work for yourself and hopefully saved you some money in the process.

Howard Botts: Right, and absolutely, and have a healthy environment to get in. Often we find people that don't remediate right away and don't have resources are moving into homes that may have black mold, other kinds of things. So obviously, there's dollar risk, and there's health risk incurred by waiting.

Allie Barefoot: 100%, yeah. Thank you so much, Howard, for shedding some light into the data of Cotality's 2026 Hurricane Risk Report and talking with me as hurricane season has officially kicked off. Hopefully, we'll have a conversation later this year to possibly talk about what we learned from this past hurricane season. So thank you again, Howard, for taking the time to be with me today.

Howard Botts: Oh, it's an absolute pleasure, Allie. And hopefully, we report no landfalling hurricanes, everybody was healthy and happy and safe, but history doesn't seem to track with that outcome.

Allie Barefoot: Absolutely. Yes, sending good thoughts this hurricane season, and in November hopefully we have good things to report back.Thank you again to Howard Botts for joining us here on Data in Context, and thank you so much for listening. If you haven't already, subscribe to Cotality's YouTube channel, and as always, if you want to find out more information, head over to