The US Federal Emergency Management Agency (FEMA) has given an update to estimates for National Flood Insurance Program (NFIP) claims arising from Hurricane Ian to somewhere between $3.7bn and $5.2bn.
This new figure is a slight bump from earlier estimates in November, when FEMA suggested NFIP losses would reach $3.5bn to £5.3bn.
FEMA had reported back then that the NFIP has now received 44,000 claims from Hurricane Ian and has paid almost $437m to policyholders. As of October 4th, the NFIP had received more than 25,000 claims, with FEMA saying at the time that it had provided $3.5m in advance payments to policyholders.
Now, the agency is saying that it received 46,000 claims. More than $237m of those claims, it says in a statement, were in the form of advanced payments, where policies could receive up to $20,000 after filing a claim.
Deanne Criswell, FEMA administrator, said: “Since Hurricane Ian made landfall, FEMA and the entire federal family have provided billions of dollars in support to help Florida recover and affected residents jumpstart their recovery. The $1.2bn paid to NFIP policyholders represents our continued commitment to this critical mission and underscores the importance of purchasing flood insurance. That’s why we continue to encourage Floridians who may have let their flood insurance coverage lapse to take advantage of our extended grace period and renew their coverage today by contacting their insurance company or agent.”
The losses include flood insurance claims from five states, with the majority of these coming from the State of Florida, where Ian made landfall as a strong Category 4 storm.
At the lower end of FEMA’s initial loss estimate for the NFIP, its reinsurance protection would not trigger as this is set at $4bn or more to trigger a percentage of recovery payments.
However, if losses do come in above the $4bn mark, then the NFIP will be able to collect under its 2022 reinsurance programme.
At the end of November, FEMA said that it had paid $793m in claims with Federal support nearing $3bn at the time. That $793m was an increase of $141m from the $652m registered just over a week before.
In addition, the US Small Business Administration has provided $1bn in disaster loans, an increase from $962m.
For 2022, FEMA secured $1.064bn of flood reinsurance protection for the NFIP.
Secured at the January 1st, 2022, reinsurance renewals, the NFIP reinsurance tower is structured to cover 4.163% of losses between $4bn and $6bn; 26.565% of losses between $6bn and $8bn; and 22.453% of losses between $8bn and $10bn.
