Hurricane Ida insurance market loss could reach $21bn: CoreLogic

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Insurance and reinsurance market losses from hurricane Ida could reach as high as $21 billion, according to analysis from data and analytics company CoreLogic.

hurricane-ida-satellite-landfallCoreLogic has provisionally pegged the insurance industry loss in a range from $14 billion to $21 billion, which includes insured damages caused by wind, storm surge and flooding.

This compares to Karen Clark & Company’s estimate of close to $18 billion, which was announced yesterday.

Overall, CoreLogic’s analysis suggests that economic losses from hurricane Ida will be somewhere in a range from $27 billion to as high as $40 billion.

These estimates are based on wind, storm surge and inland flooding damages to residential and commercial properties in Louisiana, Mississippi and Alabama.

Of course, it’s now clear that Ida’s flood impacts have carried on further north, so more can be added to these figures, you would imagine.

They also don’t include any allowance for offshore energy and marine related losses in the Gulf of Mexico, it appears.

Insured wind losses are an estimated $8 billion to $12 billion, with another $6 billion to $9 billion of insured storm surge and flooding losses as well.

More than 90% of the losses identified by CoreLogic are estimated to be in Louisiana, primarily in the nine parishes in the New Orleans-Metairie-Hammond metropolitan area and in the Ascension, Lafourche, Livingston and Terrebonne parishes immediately to the west.

“Hurricane Ida made landfall less than 40 miles away from where Hurricane Katrina made landfall, but the two storms had substantially different characteristics,” said Tom Larsen, principal, insurance solutions at CoreLogic. “Even though Hurricane Ida was a higher wind-speed Category storm at landfall, Hurricane Katrina had a much larger wind field and had spent many hours as a Category 5 hurricane before weakening during its approach to landfall. It brought much higher storm surge than Hurricane Ida and flooded 80% of New Orleans in addition to devastating the Mississippi coast. With climate change affecting the ocean’s temperatures, we should expect to see more frequent and destructive tropical cyclone activity. Homeowners and regional public agency leaders should prepare for more resilient city infrastructure and financial protection from catastrophe.”

“While only 40 to 50% of the flood damages from Hurricane Ida appear to be covered by insurance, this is actually an improvement from the uninsured flood damages we saw from Hurricanes Harvey and Katrina,” said Larsen. “The flood insurance gap is shrinking.”

CoreLogic’s analysis included residential homes and commercial properties, including contents and business interruption, while the inland flood analysis is based on the rainfall for 48 hours ending at 6 a.m. CDT on August 31.

CoreLogic does warn that flood related impacts continue on the path of Ida’s remnants.

Also read:

Hurricane Ida insured losses close to $18 billion: KCC.

Hurricane Ida will add momentum to reinsurance pricing: AM Best.

The catastrophe bonds marked down on hurricane Ida threat.

Hurricane Ida loss puts some aggregate covers at-risk: Fitch.

Hurricane Ida to hit quota shares & excess-of-loss reinsurance: Moody’s.

Hurricane Ida losses to fall more to reinsurance, but renewals influence low.

Hurricane Ida data suggests $15bn to $25bn industry loss: Twelve Capital.

Hurricane Ida insured losses expected in the double-digit billions.

Hurricane Ida cat bond fund impact minor on latest track: Plenum.

Hurricane Ida hits Cat 4, landfall location key to ILS market impact.

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