How are the fixed assets accounts (FAAs) and consumption of fixed capital (CFC) impacted by disasters?
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.