Howard Kunreuther

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Dr. Kunreuther in February 2020 during a PREPTalk organized by the Federal Emergency Management Agency

Howard C. Kunreuther (born 1938) is an American economist. He is the James G. Dinan professor emeritus of decision sciences and public policy at the Wharton School of the University of Pennsylvania.


He received an A.B. in economics from Bates College, and a PhD in the same subject from the Massachusetts Institute of Technology.[citation needed] He is a fellow of the American Association for the Advancement of Science, and a distinguished fellow of the Society for Risk Analysis.[citation needed]

His research focuses on managing and financing losses due to technological and natural hazards[1] such as high-level radioactive waste repositories,[2] and extreme events such as climate change,[3] terrorism,[4] earthquakes,[5] floods,[6] and hurricanes.[7]


Interdependent Security[edit]

In an interdependent world, the risks faced by any one agent depend not only on its choices but also on those of others. One weak link in a system can cause large losses to others. An example is the bombing of Pan Am Flight 103 in 1988: the bomb was loaded onto a plane at a low-security airport in Malta and transferred to Pan Am 103 where it was set to explode when the plane was 25,000 feet in the air.[8]

Guiding Principles for Insurance[edit]

  • Insurance premiums should be based on risk[9] in order to provide signals to individuals as to the hazards they face and to encourage them to engage in cost-effective mitigation measures[10] to reduce their vulnerability to catastrophes.
  • Affordability of insurance for low-income residents is an important concern if premiums rise to a level that low-income residents cannot afford. Kunreuther has proposed a mechanism whereby low-income homeowners could receive a voucher to cover the costs of protecting their property.[11]

The Behavioral Risk Audit[edit]

It is important to understand why people often do not purchase insurance voluntarily. When dealing with uncertain and risky events, individuals tend to be myopic, optimistic and to prefer the status quo. A behavioral risk audit addresses these cognitive biases so that individuals are more likely to pay attention to the potential consequences of low-probability events. Remedial solutions are proposed that work with rather than against people’s risk perceptions and decision biases. When combined with short-term economic incentives, individuals are likely to consider investing in protective measures that reduce the potential consequences of future catastrophic events.[12]


  • Kunreuther, H., Meyer, R. J., & Michel-Kerjan, E. O. (Eds.). (2019). The Future of Risk Management. University of Pennsylvania Press. ISBN 9780812251326.


  1. ^ Kunreuther, H. (1984). Causes of underinsurance against natural disasters.  Geneva Papers on Risk and Insurance, 206-220.
  2. ^ Easterling, D., & Kunreuther, H. (1995). The Dilemma of Siting a High-Level Nuclear Waste Repository. Kluwer Academic Publishers.
  3. ^ Kunreuther, H., Michel-Kerjan, E., & Ranger, N. (2013). Insuring future climate catastrophes. Climatic Change, 118(2), 339-354; Kunreuther, H., & Weber, E. U. (2014). Aiding decision making to reduce the impacts of climate change. Journal of Consumer Policy, 37(3), 397-411; and served as a Coordinating Lead Author for the Intergovernmental Panel on Climate Change (IPCC)’s 5th Assessment Report, Working Group III, Chapter 2, “Integrated Risk and Uncertainty Assessment of Climate Change Response Policies.”
  4. ^ Kunreuther, H. (2019). Testimony before the U.S. Senate, June 18, The Reauthorization of the Terrorism Risk Insurance Program; Michel‐Kerjan, E., & Kunreuther, H. (2018). A Successful (Yet Somewhat Untested) Case of Disaster Financing: Terrorism Insurance under TRIA, 2002-2020. Risk Management and Insurance Review, 21(1), 157-180.
  5. ^ Kunreuther, H. (1999). Insurance as an integrating policy tool for disaster management: The role of public-private partnerships. Earthquake Spectra, 15(4), 725-745.
  6. ^ Michel-Kerjan, E., & Kunreuther, H. (2011). Redesigning flood insurance. Science, 333(6041), 408-409; Kunreuther, H. (2018). Improving the National Flood Insurance Program. Behavioural Public Policy, 1-15.
  7. ^ Kunreuther, H., & Pauly, M. (2006). Rules rather than discretion: Lessons from Hurricane Katrina. Journal of Risk and Uncertainty, 33(1-2), 101-116.
  8. ^ Heal, G., & Kunreuther, H. (2005). IDS Models of Airline Security. Journal of Conflict Resolution, 49(2), 201-217.
  9. ^ Kunreuther, H., Dorman, J., Edelman, S., Jones, C., Montgomery, M., & Sperger, J. (2017). Structure Specific Flood Risk Based Insurance. Journal of Extreme Events, 4(03), 1750011.
  10. ^ Kunreuther, H. (2008). Reducing Losses from Catastrophic Risks through Long-Term Insurance and Mitigation. Social Research: An International Quarterly, 75(3), 905-930.
  11. ^ Kousky, C., & Kunreuther, H. (2014). Addressing affordability in the national flood insurance program. Journal of Extreme Events, 1(01), 1450001; Zhao, W., Kunreuther, H., & Czajkowski, J. (2015). Affordability of the National Flood Insurance Program: Application to Charleston County, South Carolina. Natural Hazards Review, 17(1), 04015020.
  12. ^ Meyer, R., & Kunreuther, H. (2017). The Ostrich Paradox: Why We Underprepare for Disasters, Wharton School Press, 2017.

External links[edit]