Explain why certain natural disasters prove to be extremely costly in terms of economic damages.

A natural disaster is defined as a hazardous natural event such as a tsunami, which leads to signficant damage to the human population. The economic damage often increases when wealthier countries are impacted, for example when Japan was hit by an earthquake and tsunami in March 2011, the total damage was estimated at $300 billion. A wealthier country means that there are likely to be more business' directly impacted, and that most homes were insured, therefore leading to significant losses for insurance companies. The government also spent billions on response and relief in the form of aid in order to reduce the impact time.