State University of New York Institute of Technology
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Does Aid To Rebuild After Hurricane Sandy Constitute “Moral Hazard”?

This article brings up an interesting issue about building on the coastline where it is virtually inevitable to avoid hurricanes. People who live on the coastline and were affected by hurricane Sandy, will generally receive income for the loss of their property. However, this raises an ethical issue; should these people build at their own risk or be insured when damage and/or loss is sure.

Some might argue it shouldn’t be an obstacle to build where you want, but if there is a guarantee to lose property or lives, should there be compensation for this?

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