Hurricane Katrina exposed the nation’s ongoing vulnerability to large-scale losses from natural disasters. The catastrophic loss of life and property has lead people to question why the United States is not better prepared for such disasters. In this Issue Brief, a leading expert on decision processes and low- probability events discusses the reasons why people do not take protective measures voluntarily. In addition, he suggests ways to reduce losses through a disaster management plan that includes well-enforced building codes and land-use policies, insurance incentives, and long-term loans.