Sandy Update: Flood Insurance Program Under Siege

A Halloween update on Hurricane Sandy's impact on the insurance industry:

• Following studies earlier in the year indicating that the P&C market is hardening up, a Seeking Alpha blogger suggests that "the P&C insurance pricing cycle is on the upswing."

• That means that insurers are expected to be well-equipped to meet claims obligations post-Sandy, according to Morningstar. But because many of the damages will be flood-related, this has reignited the debate over whether the federal government should be subsidizing flood insurance in the first place, Time adds. (Late-breaking: Floods add "wild cards" to insurer response, reports Bloomberg.)

  Deloitte's Howard Mills told I&T after Hurricane Irene last year that there should be more take-up of flood insurance in the Northeast, but CoreLogic's Howard Botts noted later in the year that there are risk isn't adequately displayed on the industry-standard, FEMA-provided flood maps.

• Meanwhile, the Palm Beach Post wonders if Sandy could spur creation of national disaster insurance.

• Wired posits that insurers could lead the charge for more sustainable development as hurricane risk shifts due to climate change. While the cause of climate change is debated, I&T finds a growing number of insurers acknowledge its risks.