Wharton marketing professor Robert Meyer and his co-authors on several studies have explored the reasons why individuals and organizations fail to prepare adequately for major disasters such as hurricanes. They argue that three mental biases impair our ability to project the likelihood and negative impact of a looming disaster appropriately. Here's Meyer describing the findings:
Basically, what we found over a number of years and using a combination of field surveys and working with people in laboratories, is that effectively, people are subject to three major biases. One is, simply put, that there is a tendency to under-appreciate the future or under-consider the future, or future consequences. A second thing is that people are too quick to forget the past, or too slow to remember the negative events that have happened in the past. The third one is that if in doubt, what often happens is that people will follow the advice of other people who are no less prone to those sorts of mistakes than they are.
I believe similar biases explain why many firms fail to prepare adequately for major disasters of all kinds, not simply natural disasters. By making executives aware of these biases, perhaps firms can do a better job of preparing for events that could impact their operations in a significant way.