The Midsize U.S. Cities Facing the Greatest Financial Threat From Natural Disasters

A natural disaster can come and go quickly, giving way to calmer winds and clearer skies in its wake. But the financial damage that a natural disaster can cause may linger long after severe weather subsides.

Insurance can help protect homeowners and renters from significant financial losses. But earthquakes, floods, hurricanes, tornadoes, and wildfires can still leave people with payments for deductibles, expenses related to evacuations, repairs that insurance doesn’t cover, and costs related to temporary housing.

Keeping up with those payments can be a challenge, especially for people who also experience a drop in income after a natural disaster strikes. Those who lack sufficient emergency savings may have to turn to credit cards or personal loans to keep up with their bills.

The Atlantic hurricane season stretches from June 1 to November 30 every year, marking a six-month period when conditions can be ripe for hurricanes and tropical storms.

Forecasts can’t always predict when and where a storm will make landfall. And the fact that a single severe storm can wreak havoc on a community is a cause for concern for many.

BadCredit.org analyzed 187 midsize U.S. cities with populations between roughly 100,000 and 500,000 residents to determine where natural disasters pose the greatest combined financial threat. 

The study took into account the recent disaster histories, future risk of natural hazards, flood insurance claims, and public recovery spending of a city, as well as residents’ potential ability to bounce back financially. New Orleans ranked first with a score of 73.80, while Virginia Beach had a score of 28.27 and ranked 187th.

“That saying, ‘prepare for the worst and hope for the best,’ really applies here. Certainly, some cities are less prone to natural disasters than others, but it’s still a good idea to think about what could happen in your area and then take steps to mitigate any potential financial damage,” said Erica Sandberg, consumer finance expert at BadCredit.org.

New Orleans has the dubious honor of taking the top spot in the rankings. The Crescent City has seen its share of disasters through the years.

And the cumulative effect of those disasters, as well as the city’s high projected overall risk index, billions of dollars in flood losses, and substantial public spending on recovery, contributes to its ranking.

The data associated with the city over the 10 years examined included:

• 23 recorded disasters
• 20 major disaster declarations
• 19 emergency declarations
• Close to $5.9 billion in National Flood Insurance Program (NFIP) claims paid
• $16,538 in Public Assistance funding per capita
• A FEMA Overall Risk Index of 98.251

Louisiana’s most populous city received a historical financial cost score of 73.85 — the highest in the study — and an overall risk index score of 98.15

On the plus side, New Orleans has a FEMA Community Resilience rating of 99.873, which is one of the best in the study. That relatively strong resilience rating lowered The Big Easy’s household vulnerability score.

The bottom line is that New Orleans isn’t lacking when it comes to its disaster preparedness. But the city’s projected exposure to natural disasters, along with its history, is such that it takes the pole position in BadCredit.org’s rankings.

The case of New Orleans shows that a city can have the capacity not only to weather but also to rebound from a disaster, even if it carries a heavy burden from the costly calamities that have plagued it time and time again.

New Orleans isn’t the only city in Louisiana to rank high in the study. In fact, the seven cities with the highest ranking are all from either Louisiana or Florida, and Florida alone accounts for half of the cities in the top 20. 

Overall, 13 of the top 20 cities are located in the two states, and they tend to have very high risk index ratings and repeated disaster declarations with hefty payouts for flood insurance.

1. New Orleans, Louisiana

With a combination of the study’s highest historical financial-cost score, projected overall risk index, and substantial disaster exposure, New Orleans ranks first among the cities examined. 

Key Stats:

• Total score: 73.80
• Disasters during the past 10 years: 23
• NFIP claims paid: $5.9 billion
• Public Assistance funding per capita: $16,538
• Overall Risk Index: 98.251

2. Baton Rouge, Louisiana

Sitting only about 80 miles away from New Orleans, Baton Rouge — which had one of the highest historical-exposure marks in the study — ranks second. The capital of Louisiana had 18 emergency declarations and 29 major disaster declarations in the underlying data.

In addition, Baton Rouge’s $19,143 in Public Assistance funding per capita was the second-highest figure among the top five cities.

Key Stats:

• Total score: 67.95
• Major disaster declarations: 29
• Public Assistance funding per capita: $19,143
• Overall Risk Index: 97.964

3. Cape Coral, Florida

The Sunshine State’s highest ranking belongs to Cape Coral, which comes in third. The city provides a clear example of financial exposure coupled with limited capacity for recovery.

Lee County, where Cape Coral is located, recorded roughly $3.55 billion in NFIP claims. In addition, Cape Coral received a household vulnerability score of 63.84 and a future-risk mark of 98.99.

The FEMA Community Resilience rating for the city was a mere 8.779. Lower resilience can make recovering from a disaster more challenging, and that result boosted Cape Coral’s vulnerability score.

Key Stats:

• Total score: 64.67
• NFIP claims paid: $3.55 billion
• Future-risk score: 98.99
• Community Resilience: 8.779

4. St. Petersburg, Florida

Staying in the state of Florida, St. Petersburg — with 21 disasters, 25 major disaster declarations, and 17 emergency declarations in the underlying data — ranks fourth.

Similar to nearby Cape Coral, St. Petersburg combines a high overall risk index with relatively low resilience. The city’s community resilience score of 10.91 factored into its household-vulnerability score of 61.96.

Key Stats:

• Total score: 63.83
• NFIP claims paid: $3.22 billion
• Future-risk score: 98.12
• Community Resilience: 10.91

5. Tallahassee, Florida

Tallahassee ranks fifth in the study and is the second capital city among that group. It’s the third location in Florida found in the first five, but its financial profile is different from the other coastal leaders in the state.

The city’s NFIP claims total was roughly $9.7 million, which is much lower than those of Cape Coral and St. Petersburg. But Tallahassee led the other four cities in the top five in terms of Public Assistance funding per capita, with $27,099. That funding contributed to a historical financial-cost score of 50.07.

Key Stats:

• Total score: 63.21
• Public Assistance funding per capita: $27,099
• Historical financial-cost score: 50.07
• Overall Risk Index: 93.352

These rankings are more than just a list of cities that received more federal money than others.

A significant component of the overall score (30%) comes from the future-risk category. Of the 20 cities with the highest ranking, 17 had future-risk scores of 98 or greater. This indicates the cities near the top of the rankings had historical costs and face high projected risk in general.

The California cities of Burbank, Glendale, Long Beach, Pasadena, Santa Clarita, and Torrance — all of which are located in Los Angeles County — rank as eight through 13. Each of them received a score of 100 on future risk.

But these locations differed from the leading cities in the study from Florida and Louisiana in that each of them had significantly lower historical financial-cost scores. That prevented them from occupying spots closer to the top of the overall rankings.

Because the six cities are all in Los Angeles County, they share county-level FEMA measurements. As such, their claims, disaster, resilience, and risk values reflect the geographic level of the source data and don’t comprise six distinct city-level values.

In summary, the high overall risk indices for Burbank, Glendale, Long Beach, Pasadena, Santa Clarita, and Torrance were somewhat offset by the financial metrics included in the study, leaving the leading cities from the Gulf Coast in higher overall positions.

A natural disaster isn’t an easy thing to cope with for anybody, but it can be especially tough for people who are at a financial disadvantage.

The study’s household-vulnerability category takes FEMA Community Resilience, median household income, and unemployment into account. Higher unemployment, along with lower income and resilience, increases vulnerability.

A good example of this is Brownsville, Texas, which ranked 20th overall despite a household-vulnerability score of 71.88, good for the second-highest in the whole dataset.

Brownsville’s position suggests that a future disaster there could cause a high level of financial disruption. This is despite the fact that the city’s federal recovery costs and historical claims don’t match those of Florida’s coastal cities or New Orleans.

Both Cape Coral and St. Petersburg are noteworthy here as their future-risk scores are higher than 98, but their marks for community resilience are less than 11. New Orleans and Metairie, Louisiana, on the other hand, have relatively high historical exposure, yet their community resilience scores are 99.873 and 97.742, respectively.

While historical exposure helps determine the cost and likelihood of a disaster, financial vulnerability helps indicate how challenging it may be for a community to absorb that disaster.

The cities at the bottom of the list received the lowest combined scores in the study’s metrics. But that doesn’t necessarily mean they are completely immune to the risks of natural hazards.

187. Virginia Beach, Virginia

The last-place city in the study is Virginia Beach. Located in southeastern Virginia, it received a score of 28.27. Virginia Beach experienced five disasters in the study’s 10-year period, and its FEMA Overall Risk Index was 57.856, which is much lower than New Orleans’ mark of 98.251.

Key Stats:

• Total score: 28.27
• Disasters during the past 10 years: 5
• Future-risk score: 55.51
• Household-vulnerability score: 32.60

186. Arlington, Virginia

Arlington’s score of 30.79 was the second-lowest in the study. In close proximity to Washington, D.C., Arlington’s relatively high median household income of $142,114 helped to lower its household vulnerability score. And its historical financial cost score was just 0.53.

Key Stats:

• Total score: 30.79
• Historical financial-cost score: 0.53
• Median household income: $142,114
• Overall Risk Index: 66.794

185. Hampton, Virginia

Yet another city in Virginia, Hampton, ranks third-lowest on the list with a score of 31.12. Hampton’s associated data includes close to $64.5 million in NFIP claims along with six disasters. However, its financial cost and overall scores remained low relative to the rest of the group.

Key Stats:

• Total score: 31.12
• Disasters during the past 10 years: 6
• NFIP claims paid: $64.5 million
• Overall Risk Index: 61.737

Though Arlington, Hampton, and Virginia Beach are all in Virginia, they don’t share the same county data. As such, their occupation of the bottom three spots reflects their individual metrics and is not a general conclusion about the state as a whole.

A city’s location can affect more than its odds of facing a natural disaster; it can also influence the financial resources needed for recovery.

Federal assistance and insurance can help cover some losses that result from a disaster, but they don’t ensure that households will come out the other side financially whole.

Coverage limits, deductibles, delayed aid, lost income, and the need to relocate — even if only temporarily — can leave residents with expenses they have to pay themselves.

Consumers who live in high-risk areas when it comes to natural disasters can prepare themselves for when they strike by making sure they understand their insurance coverage and deductibles, keeping emergency savings in a place they can easily access, and maintaining detailed records of their belongings.

“If you don’t have an emergency fund yet, start one now. If Mother Nature never strikes, great. You’ll have cash for other necessary issues. However, if you do live in one of the high-risk cities that we identified in this study, I strongly recommend being more assertive with planning,” adds Sandberg. 

Sandberg continues, “Credit products can come to your rescue if you don’t have enough savings or insurance won’t cover important things. Keep your credit scores as high as possible and your revolving balances low, so that if you need to rely on a loan or credit card, you’ll be in a far better position to borrow.” 

Knowing how to reach assistance agencies and lenders after a disaster can also aid those in high-risk cities.

And bear in mind that just because a city has a higher ranking doesn’t mean that a particular household within it will definitely suffer a loss, just like a lower ranking doesn’t make a city immune to the effects of a natural disaster.

The study’s results highlight where documented financial costs, household vulnerability, overall risk index, and repeated disasters are most likely to overlap.

The methodology below explains the data inputs, scoring approach, and weighted metric framework used for this ranking.

Overview

This study evaluates which midsize U.S. cities face the greatest combined financial risk from natural disasters. A midsize city for this study is defined as a city or Census-designated place with roughly 100,000 to 500,000 residents.

It considers not only past disaster activity, but also documented flood-insurance payments, federal public recovery funding, natural-hazard risk, and economic conditions that may affect households’ ability to recover.

Cities were evaluated across four dimensions: Historical Exposure, Historical Financial Cost, Natural Hazard Risk, and Household Vulnerability. The analysis includes 187 midsize cities with complete data for the selected metrics.

Several FEMA metrics are reported at the county or county-equivalent level. These values were matched to cities located within the corresponding county. Cities in the same county may therefore share identical disaster, claims, funding, risk, or resilience values.

Data & Sources

Data were sourced from FEMA OpenFEMA and the National Risk Index, the U.S. Bureau of Labor Statistics, and the U.S. Census Bureau.

These sources were selected for their national coverage and relevance to natural-hazard exposure, documented disaster costs, local economic conditions, and communities’ capacity to recover. When release schedules differed, the most recent data available at the time of collection were used.

Scoring Approach

Each metric was collected for all 187 cities and normalized to a 0-to-100 scale using min-max normalization. Directionality was applied according to whether a higher or lower raw value represented greater financial risk. Section scores were calculated from the normalized values of their component metrics.

The final score was calculated as a weighted average of the four section scores. Historical Financial Cost and Natural Hazard Risk receive the greatest weight because the study’s central question concerns the documented and potential financial consequences of natural disasters.

Historical Exposure and Household Vulnerability receive 20 points each. Historical Exposure captures how frequently communities have encountered federally recognized disasters, while Household Vulnerability reflects economic and community conditions that may affect residents’ ability to absorb a financial shock.

A higher final score indicates greater combined natural-disaster financial risk among the cities analyzed. Rank No. 1 represents the greatest relative burden, while a lower ranking represents a lower relative score—not an absence of natural-hazard risk.

Cities Evaluated: 187
Sources Used: 3

Section and Metric Weights

Historical Exposure (20 pts · 3 metrics)

The Historical Exposure section measures the frequency and severity of federally recognized disasters associated with each city’s county or county-equivalent.

The section includes disasters during the previous 10 years, major disaster declarations, and emergency declarations. The three metrics are weighted equally. Higher counts contribute to a higher Historical Exposure score.

Because FEMA declarations can designate counties, states, tribal governments, and other geographic areas, these metrics represent disasters associated with the geography matched to each city rather than events occurring exclusively within city limits.

Disasters During the Previous 10 Years

This metric measures the number of federally recognized disasters associated with each location during the study’s 10-year period. A higher number of disasters increases the Historical Exposure score because it indicates more frequent recent exposure to significant natural events.

Major Disaster Declarations

Major Disaster Declarations measure the number of FEMA declarations classified as major disasters and associated with each location.

Major disaster declarations are issued when an event causes damage of sufficient severity and magnitude to warrant federal assistance beyond the combined capabilities of state and local governments. A higher count increases the Historical Exposure score.

Emergency Declarations

Emergency Declarations measure the number of FEMA declarations classified as emergencies and associated with each location.

These declarations authorize federal assistance for emergencies requiring coordinated action to protect lives, property, public health, or safety. A higher count increases the Historical Exposure score.

Historical Financial Cost (30 pts · 2 metrics)

The Historical Financial Cost section measures documented flood-insurance payments and federal funding for eligible public disaster-recovery work.

The section includes total National Flood Insurance Program claims paid and FEMA Public Assistance funding per capita. The two metrics are weighted equally. Higher values contribute to a higher Historical Financial Cost score.

Total NFIP Claims Paid

Total NFIP Claims Paid represents cumulative payments made through the National Flood Insurance Program for covered flood claims in the geography associated with each city. Higher claims totals increase the Historical Financial Cost score because they indicate a greater documented volume of insured flood damage.

NFIP claims do not capture uninsured damage, private insurance payments, deductibles, lost income, personal borrowing, or every cost households may experience following a flood. Claims were evaluated as raw totals and were not adjusted for city population or the number of insured properties.

Public Assistance Funding Per Capita

Public Assistance Funding Per Capita represents FEMA Public Assistance obligations associated with each location, expressed relative to population. Higher amounts increase the Historical Financial Cost score because they indicate a greater recorded scale of eligible public recovery spending relative to population.

FEMA Public Assistance primarily supports eligible government entities and nonprofit organizations for work such as infrastructure repair, debris removal, and emergency protective measures. It does not represent disaster assistance paid directly to individual households.

Natural Hazard Risk (30 pts · 1 metric)

The Natural Hazard Risk section measures the relative risk communities face from 18 natural hazards using FEMA’s Overall Risk Index.

Although this section contains one metric, the Overall Risk Index is a composite measure incorporating expected annual loss, social vulnerability, and community resilience. A higher value contributes to a higher Natural Hazard Risk score.

FEMA Overall Risk Index

FEMA’s Overall Risk Index provides a nationally comparative measure of natural-hazard risk. It considers the expected frequency and consequences of 18 hazards, along with social vulnerability and community resilience.

Higher index values increase the Natural Hazard Risk score because they indicate greater relative risk compared with other communities nationwide.

The Overall Risk Index is a baseline risk assessment. It does not predict when the next disaster will occur, guarantee that losses will occur, or directly forecast the future effects of climate change.

Household Vulnerability (20 pts · 3 metrics)

The Household Vulnerability section evaluates economic and community conditions that may affect residents’ ability to absorb and recover from a disaster-related financial shock. The section includes unemployment, median household income, and FEMA Community Resilience. The three metrics are weighted equally.

Higher unemployment contributes to a higher Household Vulnerability score. Median household income and Community Resilience are reverse-scored, meaning lower values increase vulnerability.

Unemployment Rate

The Unemployment Rate measures the percentage of people in the labor force who are actively seeking work but unable to find employment.

Higher unemployment increases the Household Vulnerability score because fewer residents may have a consistent source of income available to cover emergency expenses, temporary displacement, repairs, or other recovery costs.

Unemployment is used as an indicator of local economic stability. It does not measure the financial circumstances of every household.

Median Household Income

Median Household Income represents the midpoint of the household income distribution: half of households earn more and half earn less.

Lower median household income increases the Household Vulnerability score because households with fewer financial resources may have less capacity to manage deductibles, evacuation costs, temporary housing, lost income, and other disaster-related expenses.

Median income does not measure household savings, debt, insurance coverage, access to credit, or the financial position of every resident.

Community Resilience

FEMA Community Resilience measures characteristics that may affect a community’s ability to prepare for, withstand, and recover from natural hazards.

Lower resilience increases the Household Vulnerability score because communities with fewer institutional, infrastructure, economic, or social resources may face greater recovery challenges.

Community Resilience is also incorporated into FEMA’s Overall Risk Index. Including it separately in the Household Vulnerability section gives recovery capacity additional influence in the final ranking.

Notes: Scores are comparative within this specific group of 187 midsize cities. Several FEMA metrics are reported at the county or county-equivalent level and matched to cities within those areas.

Cities in the same county may therefore share identical FEMA values. Changing the cities, metrics, source years, scoring directions, section weights, geographic matching, or within-section metric weights would change the final rankings.

For all media inquiries, please contact catherine@badcredit.org