Hurricane Milton Insured Losses in $30B-$50B Range, Says Verisk
Author: Insurance Journal
Original article here.
Catastrophe modeler Verisk said it expects insured losses from Hurricane Milton will be between $30 billion and $50 billion from damages caused mostly by wind.
Verisk’s Extreme Event Solutions group said the range includes privately insured losses to onshore property due to wind, storm surge, and precipitation-induced flood.
Hurricanes Helene and Milton—both major hurricanes occurring just two weeks apart— could impact some loss development and settlement in Florida, Verisk said.
“One challenge that is likely to arise is over the attribution of loss to each event,” Verisk said. “Areas around Tampa Bay, south to Siesta Key, and along the coast due south toward Fort Myers were all impacted by both storms. The area south of Tampa saw significant storm surge from both events. In addition to claims settlement challenges, the back-to-back coastal flooding events could lead to aggregate flood limits being reached in some cases.”
Debris still piled outside of homes from Hurricane Helene could have exacerbated the damage from Milton, the firm added.
In addition to hurricane-force winds, Milton spawned tornadoes that also caused structural and roof damage to buildings in areas such as Fort Myers and Vero Beach.
Verisk said it also looked at Florida’s building codes, noting that Milton’s wind speeds fell below modern design guidelines for residential and commercial buildings. However, 50% of risk in Gulf Coast counties were built before early version of the state’s building codes were enacted.
Verisk’s estimate is in line with others released by catastrophe modelers since the hurricane, though it is important to note the variables included within each estimate. Karen Clark & Co. put private insured losses at about $36 billion from wind, storms surge, and inland flooding to personal, commercial and industrial properties and vehicles, as well as business interruption. Moody’s RMS early this week gave a range of insured losses of $35 billion to $55 billion—but that was for both hurricanes Milton and Helene.
Moody’s RMS said an estimate for Hurricane Milton will be released later this week.
Rating agency Fitch it expected Hurricane Milton to cause between $30 billion and $50 billion in insured losses.
Verisk’s loss estimate, like other modelers, does not include losses to the federal National Flood Insurance Program. Verisk added that its range also does not include litigation, inland marine, ocean marine cargo and hull, infrastructure, and loss adjustment expenses.
