Japan's Disasters May Hit Your Finances

Whenever there is a natural disaster causing human death and suffering on the scale of what we've seen in Japan, all human beings do a few things:
We grieve.
We recover.
We learn.

While scientists and policymakers try to learn about the true risks of nuclear energy, earthquakes, and tsunamis, consumers should be learning about how they might be affected in such a disaster.
Why the Earthquake, Tsunami, and Nuclear Meltdown are Insurance Disasters as well

Despite this being the largest earthquake on record and the tsunami hitting widely and severely in the worst possible places, this is nowhere near the largest loss of life. Still, compared to the Indian Ocean tsunami of 2004 that killed over 230 thousand people and destroyed the way of life for many more, or the even more recent 2010 Haiti earthquake that killed 316 thousand so far, the few thousand killed in Japan doesn't seem like it should have the largest insurance impact. But it does.
This is because very few people killed in Haiti Earthquake and in the Indian Ocean Tsunami had insurance policies.

These would have been less disastrous to human life had 1) facilities been more prepared for destruction on such a scale (a lesson we must learn perhaps) and 2) people had health insurance that would cover treatment.

Think about this as well: insurance companies don't plan to pay out so many life policies all at once. Japan has perhaps the highest rates of health and life coverage in the world, which is great in terms of saving lives and livelihoods. However, there is some worry that paying out so much money could financially cripple the insurers. Analysts fear some insurers will collapse and be unable to pay out.
Insurance Rates Astronomical in Disaster Zones

The average cost of insuring a life in the United States is roughly $1,600 a year. In Japan, it is approximately $3,200.
However, perhaps because the Japanese people know how high risk they are, they buy insurance in greater amounts than the United States. The ratio of the total premiums paid to gross domestic product (called insurance penetration) is over 8% in Japan compared to about 3.5% in America. Were widespread disaster to strike the United States, say in the form of famine (deadliest of natural disasters), the impact would be horrendously incredible.
Life Insurance in US Hit, Responds

Policies in Japan tend to pay out more than they do in the United States. However, many insurance providers in Japan are American companies. They may lose many billions of dollars as a result of this disaster, and consumers in America could suffer as well. While these life insurance companies insist they will stay solvent, it may be at the cost of cheap life insurance policies. Financial impact could be distributed through US policies and debt, according to analysts.

As scientists and actuaries learn more about the impact of these natural disasters and how financial systems respond, they may upgrade the risk of natural disasters in many parts of the world. Live near a nuclear power plant? Look out for an increase in premiums.
If your rates go up, get some life insurance quotes.