The Florida Office of Insurance Regulation (FLOIR) has recorded another near 6% rise in the number of insured claims from last year’s hurricane Irma to roughly $11.1 billion and this loss creep is set to continue as 76,298 claims from the storm are still open in the state.
Hurricane Irma loss creep has been a topic of conversation for some time, as the industry loss kept rising throughout 2018 and as a result loss estimates had to be increased by many in reinsurance and also insurance-linked securities (ILS) funds.
It seems that the creep is ongoing, as the latest data from the Florida regulator shows that its tally of insured claims paid has risen by nearly 6% since late August when the total was just under $10.5bn to now reach $11.1 billion.
The loss creep will continue as well, with 76,298 claims still open and while 92.4% of all claims are now closed, in commercial property that percentage drops to just 76%, commercial residential just 81.6%, suggesting there is some way to go and some of the larger property claims still to be settled.
The latest data is as of November 14th and shows Broward County as the area lagging, in terms of claims closed, again at just 86.6%.
The total insurance and reinsurance industry loss from hurricane Irma is much higher than the regulator data, as this only addresses primary insurer claims reported to the FLOIR in filings.
But this latest data update from the regulator does show that further loss creep is to be expected, given there are so many tens of thousands of claims left open still.
In addition, the spectre of claims getting re-opened has troubled the insurance and reinsurance industry with hurricane Irma, as well as the prospect of assignment of benefits (AOB) claims adding to the bill and loss creep as well
As a result it will be some more months before the final industry loss can be understood, it seems and the hurricane Irma loss creep will continue and possible further impact ILS fund performance in months to come, so there could be more negative impacts ahead for certain providers of reinsurance and ILS capital as the costs of hurricane Irma become clearer.
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