According to the Florida Office of Insurance Regulation (FLOIR) the value of insurance claims from hurricane Irma in the state of Florida has risen to just over $8.6 billion, with still more than 100,000 claims remaining open.
It’s around a 7% increase from a February estimate of just shy of $8 billion and shows that insurers continue to turn around claims, raising the burden for reinsurance providers that are yet to settle on claims.
Industry-wide estimates of U.S. insurance and reinsurance losses after hurricane Irma range from $14 billion and upwards to $17 billion, we understand.
The figure of over $8.6 billion from the Florida Office of Insurance Regulation is based on insurance claim amounts agreed upon and with 11.5% of claims filed still open this total is destined to rise further.
The issue of re-opened claims and the influence of assignment of benefits (AOB) are also issues that could cause further loss creep in the hurricane Irma insurance and reinsurance claims totals over the coming months.
Commercial claims, both commercial residential and commercial property, continue to lag behind in terms of speed of settlement. Currently only 58% of commercial property claims have been closed and 72% of commercial residential, compared to most other categories of claims being at least 83% resolved at this stage.
Many reinsurance providers have already paid their claims to insurers for the losses caused by hurricane Irma, as have many of the retrocessionaires, including ILS funds and third-party capital providers.
However there are industry-loss warranties (ILW’s), largely the aggregate covers and so-called window ILW’s, still exposed to creeping hurricane Irma loss estimates, as well as to other events from 2017.
It could take some time still for those to be fully resolved, as the percentage of claims settled continues to increase and with the commercial property claims still slow to resolve and likely costly, the final figure from the FLOIR could creep higher still.