While the East Coast braces for the perfect storm, exchange traded funds that follow the insurance industry are already taking a hit as investors anticipate billions of dollars in damages.

Hurricane Sandy is heading toward the Mid-Atlantic and Northeast and is expected to merge with a winter storm and artic air in what forecasters are dubbing “Frankenstorm.”

“With the angle that it’s coming in, it’ll just pile up water right up against the shoreline,” Henry Margusity, senior meteorologist with AccuWeather, said in a MarketWatch report. “We’re still trying to assess the surge of water from the storm. There could be flooding up the Hudson River all the way to New York City.”

“There will be school closures, travel will be messed up for days and major airports will be closed,” Margusity added. “This could be a disaster of biblical proportions — a multi-billion-dollar disaster.”

Consequently, insurance company stocks are reeling in anticipation of the severe hit.