A recent study by the University of Illinois found that a replay of the New Madrid earthquakes of the 1800s would have a devastating impact in the Midwest; an impact that would dwarf the catastrophic damages of any natural disaster this nation has ever experienced.

The threat is very real and if ever there was a time for a Homeowners' Defense Act, the time is now.

In recent months, the Midwest has been the site of several small, but significant, earthquakes of magnitudes in the range of 5.0 on the Richter scale. The recent report looked at what would happen if the region were hit with earthquakes of a 7.7 magnitude along the New Madrid fault. The results are terrifying.

The report suggests that such an earthquake would render 7 million people homeless, would damage 715,000 buildings and would have a $300 billion economic impact.

The human toll would be enormous, and the economic toll would be paralyzing.

Because St. Louis and Memphis are in such close proximity to the New Madrid fault, those important cities would suffer the most damage. But, the impact would be felt throughout at least eight Midwest states including Alabama, Mississippi, Arkansas, Missouri, Illinois, Indiana, Kentucky and Tennessee. Many of these states rely on the Mississippi River and its ports for commerce.

Similar earthquakes struck the region in 1811 and 1812. According to the U.S. Geological Survey, they were equal to the San Francisco earthquake in force and, had the Richter Scale existed, would have exceeded 7.0 in magnitude.

Those earthquakes changed the course of the Mississippi River, formed new lakes and damaged structures as far away as Cincinnati. Their shock waves covered more than a million square miles, from Mississippi to Michigan, from Pennsylvania to Nebraska. Landslides and extensive subsidence occurred in an area that today would stretch from Cairo, Ill., to Memphis.

Damage was limited because those earthquakes struck when the region was a vast wilderness, a part of the newly acquired Louisiana Purchase.

Today, millions of American families make their homes right on top of the New Madrid fault. Mid-America cities like Nashville, St. Louis, Memphis and Little Rock would all suffer were we to experience a replay of the New Madrid earthquakes. Because the area is host to countless natural gas lines and other critical national infrastructure, the entire country would suffer from the collateral damage.

Preparing for the physical and human costs of a massive earthquake will require better building codes and smarter planning. Unlike California, where earthquake awareness is a way of life, the same has not been historically true in much of the heartland.

Fortunately, earthquake education recently has been mandated in some Mississippi Valley states, the National Earthquake Hazards Reduction Program has expanded its efforts in the area, and most states in the earthquake zone have adopted better building codes.

Those codes only apply to new buildings, and cover only a fraction of structures in the area of the New Madrid fault line. Most of the existing homes, schools and commercial buildings have not been designed to withstand the stress of earthquakes, so enormous destruction could be expected when the next tremors roll.

The economic devastation and the potential for the largest financial bailout in the nation's history could be avoided if we take steps now to pre-fund for the natural catastrophe we know might come.

What is needed is a privately funded public partnership that helps to pre-fund the financial costs of a large-scale natural catastrophe. Such a program would facilitate the risk participation of the private sector, expand the availability and sustainability of the catastrophic insurance system, and provide potent incentives for residential property owners to undertake catastrophe loss mitigation efforts. This approach should add capacity to the private insurance market and lower consumer costs. From an economic perspective, such an alliance of public and private resources is the optimal manner to address the inefficiencies that plague the present system of federal disaster relief.

Legislation to accomplish these goals was reported from the House Financial Services Committee at the end of April. The bill, The Homeowners' Defense Act HR 2555, has bipartisan support and was endorsed by President Obama when he was seeking the presidency. The entire House of Representatives may vote on the bill in to coming weeks.

With hope, it will be enacted before the next earthquake strikes.

James Lee Witt and James M. Loy co-chair ProtectingAmerica.org. Witt is a former director of the Federal Emergency Management Agency. Loy is a former Commandant of the U.S. Coast Guard and former deputy secretary of the Department of Homeland Security.