The cost of Helene's recovery could reach $34 billion. Who might bear the expense?

• The cost of Hurricane Helene could reach $34 billion, as estimated by Moody's Analytics, leaving Congress and private insurers with a substantial amount to split as the storm devastates the southeastern U.S.
• In order to support the recovery effort in areas where private insurance is struggling, the federal government may need to provide subsidies.
• Congress is currently on recess until November, preventing it from approving any supplemental funding for FEMA to address the Helene wreckage with a renewed budget.

The estimated cost of the devastation caused by Hurricane Helene in the southeastern United States could reach $34 billion, according to Moody's Analytics.

In some regions, the private insurance market is deteriorating, which may require Congress to cover a significant portion of the costs.

Mark Zandi, Moody's chief economist, stated on CNBC that he wouldn't be surprised if Helene sends another monkey wrench into the insurance market.

Over the past week, towns and cities in Florida, Georgia, North Carolina, South Carolina, Virginia, and Tennessee were devastated by uprooted trees, 140 miles per hour winds, and mass flooding.

Over 200 individuals had lost their lives due to the storm by Thursday, while hundreds were still missing. Approximately 1 million people were left without electricity.

Last week, as Helene was making landfall, Moody's released a report estimating property damage costs between $15 billion to $26 billion.

The resulting economic slowdown could result in productivity losses of $5 billion to $8 billion.

Zandi informed CNBC that the initial estimates of the storm's damage are likely to be revised upward as the full extent of the damage becomes clear.

River flooding and storm surges are the main causes of the damage inflicted by Helene.

According to Mark Friedlander, spokesman for the Insurance Information Institute, flood insurance, not standard property insurance, is intended to cover flood damage.

According to Friedlander, a problem is that many areas in the Southeast and southern Appalachia have low flood insurance take-up rates, which are the regions that have been hit the hardest.

Despite 90% of natural disasters involving flooding, only about 6% of U.S. homeowners have flood insurance through either a private company or the congressionally funded National Flood Insurance Program.

The Federal Emergency Management Agency, despite having a limited budget in the past year, has been managing the recovery efforts for Helene.

On August 7th, FEMA activated its "Immediate Needs Funding" status due to a depletion of funds in its Disaster Relief Fund.

The agency would prioritize immediate disaster response over long-term rebuilding efforts nationwide.

After Congress passed a stopgap funding bill, FEMA received a $20 billion cash infusion on Tuesday.

Government officials are urging Congress to pass a supplemental disaster relief funding package after assessing the extent of Helene's damage. The package was previously removed from a temporary spending resolution.

That could take some time as Congress is on recess until Nov. 12.

President Biden stated on Monday that he might need to request Congress to end its break early and return to Washington to pass more disaster relief funding.

On Monday, several lawmakers from affected states, including Rep. Wiley Nickel, D-N.C., urged their colleagues to return to Capitol Hill to vote for funding.

Florida Republican Senator Rick Scott concurred, stipulating that Congress should wait for a definitive dollar amount from FEMA before resuming.

Rep. Mark Amodei, R-Nev., stated that he believes Congress does not need to end its recess early as FEMA is still evaluating its initial funding request.

"Amodei stated, "We can handle it when you have a specific number. Currently, you're aiming at an unidentified target.""

Amodei stated that he was not excited about the outcome of FEMA's assessment, as he believed it would result in a significant number.

Other federal leaders are also contributing to the effort.

The Federal Reserve Chair Jerome Powell stated on Monday that the central bank is taking measures to guarantee that banks in affected regions have sufficient cash reserves, enabling them to conduct transactions even if power outages persist for an extended period.

"Powell stated at a panel with the National Association of Business Economics, "Clearly, our role is mostly to observe and offer support during this challenging circumstance.""