While terrorism and natural disasters are different, they have several important features in common uncertainty and wide variances in losses from one year to the next. Experts and decision makers face challenges in assessing the risks associated with these extreme events, developing strategies for reducing future losses, and facilitating the recovery process following a major disaster. In the past seven years, we have entered a new era of catastrophes. Our nation is facing large?scale risks at an accelerating rhythm, and we are more vulnerable to catastrophic losses due to the increasing concentration of population and activities in high?risk coastal regions of the country. The question is not whether catastrophes will occur, but when, and how frequently they will strike, and the extent of damages they will cause. Now is the time to develop and implement economically sound policies and strategies for managing the risk and consequences of future disasters. Absence of leadership in this area will inevitably lead to unnecessary loss of lives and economic destruction in the devastated regions.