International catastrophe risk modeller, AIR Worldwide, has released an insurance industry loss range estimate for the U.S. for hurricane Irma, of between $20 billion and $40 billion.
AIR underlines that the estimates are based on the NHC’s Sunday, September 10th, 5pm EDT forecast.
Exposure value in coastal counties along the Gulf Coast up to Tampa, says AIR, is estimated to be at a huge $1 trillion, with AIR stressing that these areas will “bear the brunt of the impact.”
The storm battered parts of the Caribbean before hitting Cuba, and then heading towards the state of Florida as a Category 4 storm. Most of Florida experienced very strong winds and intense rainfall, and the region is vulnerable to a dangerous storm surge, says AIR.
“By the 2:00 a.m. NHC advisory, Irma had been downgraded to a Category 1 storm with sustained winds of 85 mph. Irma is expected to reach Georgia by Monday afternoon, where it will encounter increasingly strong wind shear and quickly weaken. However, torrential rains are expected to produce inland flooding, with life-threatening flash floods, throughout much of the state,” explains AIR.
AIR notes that its modelled loss for the event for the U.S. includes wind and storm surge damage to onshore residential, commercial, and industrial properties as well as contents. Automobile and time element coverage is also included in AIR’s modelled loss for the event.
With the storm still impacting parts of the U.S. and in light of the widespread damage caused, it will take some time before the actual economic and insured loss comes to light. So it remains to be seen if the storm, combined with Harvey losses, will impact global reinsurance pricing.
During the 2017 meeting of the reinsurance industry in Monte-Carlo, some speakers and executives have suggested that a loss of $40 billion might not be enough to turn the market from its softening phase.
