In 2015, The Perryman Group prepared a study to assist the efforts to reform the windstorm insurance system which focused on the possibilities of major storms along the Gulf Coast. While the analysis obviously does not reflect the unique and unprecedented effects of Hurricane Harvey, it does provide some useful insights. Given the significance of this historic storm and its role in the economy in the coming months, we wanted to share these insights.

The counties along the Texas Gulf Coast (including Harris County) comprise a significant proportion of overall business activity in Texas. The Perryman Group estimates that the area accounts for some 33.4% of total Texas real gross product (measured as of 2014), and more than 23.5% of Texas' population resides in the area.

The area is also crucial to employment, with 25.0% of total Texas jobs (26.3% by the wage and salary employment measure). The coastal counties of the Tier 1 Windstorm Insurance coverage area include Aransas, Brazoria, Calhoun, Cameron, Chambers, Galveston, Jefferson, Kenedy, Kleberg, Matagorda, Nueces, Refugio, San Patricio, and Willacy counties as well as portions of Harris County. In addition, these counties comprise significant portions of real personal income, with almost 26.6% by place of residence (31.6% by place of work).

The Perryman Group also measured the potential consequences in each region to significant disruptions stemming from storms in the Tier 1 area. The results at the state level are summarized below.

Overall Economic Activity Directly Vulnerable to Significant Disruptions in the Event of a Storm in the Tier 1 Windstorm Insurance Coverage Area

	Gross Product		Personal Income		Employment
	Amount	Percent	Amount	Percent	Amount	Percent
Rita Level Storm	$10.732	0.72%	$6.408	0.74%	70,736	0.59%
Ike Level Storm	$21.955	1.48%	$13.110	1.51%	144,709	1.21%
Katrina Level Storm	$78.386	5.27%	$46.805	5.40%	516,650	4.31%
Note: Assumes that damage occurs in a "typical" segment of the Tier 1 area and that all direct rate increases are being borne locally (thus increasing risks and reducing coverage).
Units: Gross product and personal income in millions of 2009 dollars, employment in unit jobs.

For more details please refer to the full report.