Investing in Areas With A History of Natural Distasters

[Steve W.]

To buy and hold investors in natural disaster zones - such as hurricanes impacting Houston TX or panhandle of Florida (Pensacola was hit this year by Hurricane Sandy), how do you account for this risk in your investing?

For example, Houston looks great on paper. But I see distressed properties for sale that were flooded by Hurricane Harvey; if insurance covers this why aren't the properties fixed? Even if this type of damage is atypical, what about more common damage? Does this result in frequent insurance claims? Do you need higher reserves?

Thanks