Sunday, September 26, 2021

Insurance companies may lose $18 billion due to Hurricane Ida: industry experts

Karen Clark & ​​Co (KCC), a disaster modeling company, said on Wednesday that insurance companies are preparing for approximately $18 billion in losses from Hurricane Ida in the United States and the Caribbean.

This number is closer to the lower bound of the initial estimate given by insurance analysts earlier this week when the storm was still raging, and is the first number from a major risk modeling expert in the industry.

KCC stated that US$40 million worth of insured losses will occur in the Caribbean, and the rest will come from wind and storm surge losses in the United States.

After Hurricane Ida swept the coast from the Gulf of Mexico, it landed in the United States as a Category 4 storm on Sunday. Large waves and heavy rain flooded a large area.

Earlier this week, insurance experts estimated that Hurricane Ida’s claims were between 15 billion and 30 billion U.S. dollars, but warned that this number could be higher, partly because pandemic pricing pushed up the timber and labor required for reconstruction. cost.

According to experts, extensive estimates based on models that track the severity and path of storms, adjusted for inflation, may still be far below the US$87 billion in claims caused by Hurricane Katrina in 2005.

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The rating agency Fitch stated that Ida’s losses could exceed the US$15 billion in Winter Storm Uri and the US$10 billion in Hurricane Laura (the most insured disaster event in 2020).

KCC stated that its data shows that Ida is tied with the last island hurricane of 1856 and the strongest sustained wind speed when Hurricane Laura made landfall in Louisiana in 2020.

Its forecast includes loss of privately insured residential, commercial and industrial property, and automobiles. It does not include damage to ships, marine properties, or the United States’ National Flood Insurance Program.

UBS analysts said that the impact of Ida will have the worst impact on Swiss Re and Lancashire’s earnings per share, down 32% and 30%, respectively, while Hannover Re and reinsurance industry leader Munich Re will be the least affected .

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Authors: Noor Zainab Hussain and Carolyn Cohn

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This News Originally From – The Epoch Times

Insurance companies may lose $18 billion due to Hurricane Ida: industry experts
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