Catastrophic events, such as hurricanes or terrorist attacks, are classified as disasters if either the associated property loss or the insurance payouts exceed 0.1 percent of GDP (in 2021, about $23 billion in current dollars). Losses of and non-repairable damages to the stock of fixed assets (structures, equipment, and software) associated with a disaster are included in "other changes in volume of assets," which are a subtraction in the derivation of net stock1. Disaster losses are not included in depreciation, as the depreciation schedules reflect normal accidental damage. These losses are not considered normal and therefore are not included in the consumption of fixed capital (CFC) as a charge against income earned from current production. Estimates for "other changes in volume of assets" are published annually in Fixed Assets Accounts (FAA) Tables 1.7 and 1.8. Additionally, estimates for disaster losses are published annually and quarterly as addenda items in NIPA table 5.1.
More information on the treatment of disasters is available in the March 2009 Survey article, “Preview of the 2009 Comprehensive Revision: Changes in Definitions and Presentations”. For information on the impact of disasters on the NIPAs, the regional economic accounts, or the international transactions accounts, refer to the following FAQs:
How are the measures of production and income in the national accounts affected by a disaster?
1. Net stock equals previous period net stock plus investment minus depreciation and other changes in volume of assets. "Other changes in volume of assets" for the government sector consists of disaster and war losses.