As emergency managers we know the process that is followed. In King County in the past we always ask citizens to call in and report their estimated losses (which certainly are guesses, in most cases). We plotted addresses on a map and tallied the totals. Eventually a team from FEMA and the State Emergency Management would show up for a "preliminary damage assessment." We would have internal staff and other governmental representatives take these officials around to areas that had the most damage so they could see the impact of the disaster on personal property and public infrastructure. All this would lead to a Presidential Disaster Declaration and then a more formal project-by-project damage estimate. Then, we'd have a much better estimate of the damages from a disaster.
All of the above is a far cry from someone "sticking their finger in the air" and pulling out a number from what in the military we called our "Fourth Point of Contact." Perhaps there is an algorithm somewhere that does this but I think it is unlikely for that to be the case.
