Rising insurance premiums are a major reason why 250,000 of the 1 million gulf coast residents who fled because of Hurricane Katrina last year won’t be going back, according to research by the Washington-based Earth Policy Institute.

Institute President and climate analyst Lester Brown says property insurance costs are becoming too high in the hurricane-prone coastal south-east of the US. He says an estimated 250,000 Katrina evacuees are “climate refugees”.

He says that following the last two hurricane seasons (four hurricanes crossed Florida in 2004), reconstruction is still going on, insurance costs are climbing and private insurers are withdrawing from high-risk coastal areas.

Hurricane Katrina, which made landfall late in August 2005, caused a million people from New Orleans and small towns on the Mississippi and Louisiana coasts to move farther into the state or to neighboring states such as Texas and Arkansas.

Mr Brown says although nearly all of them planned to return, many have not. “Even today, a year later, large parts of New Orleans are without basic infrastructure services such as water, power, sewage disposal, garbage collection and telecommunications.”

The population of New Orleans before Katrina struck was 463,000. By July this year, the city had only 214,000 residents.

The movement of insurers out of high-risk regions started after Hurricane Andrew hit Florida in 1992, destroying 60,000 homes and bankrupting at least 11 local insurance companies.

In response, governments in hurricane-prone states, including Florida, Mississippi and Louisiana, created state-supported insurance companies for homeowners unable to obtain private insurance.

Mr Brown says Florida state insurer Citizens Property Insurance Corporation ran a deficit of $US516 million ($679 million) in 2004.

An analysis of risks and costs late in 2005 shows premiums charged to property owners must be increased 80% to ensure the future viability of Citizens Property Insurance Corporation. The research says the bottom line is that rates must rise as the risk rises.