Louisiana insured hurricane losses from 2020 season hit $10bn

Hurricane impacts to the State of Louisiana from the record-breaking 2020 season are now estimated to have resulted in $10 billion of insurance and reinsurance market losses, according to the State’s Insurance Commissioner.

Insurance Commissioner Jim Donelon provided an update on 2020’s hurricane claims for insurers operating in the state, saying that they have now either paid or reserved for $10 billion of claims received through June 30th 2021.

These claims came from hurricanes Laura, Delta and Zeta, all of which impacted Louisiana during the 2020 season.

By the end of the second-quarter of this year, policyholders had filed 316,879 claims of all types from across the three hurricanes.

Out of those claims, 205,554, or 65%, were closed with payment as of June 30th, resulting in $7.8 billion of claims payments made for damage from the three hurricanes.

On top of this, insurers have reserved an additional $2.2 billion to pay for claims from these storms.

“As the amounts being paid out due to the devastating 2020 storm season continue to grow, I encourage policyholders to still file supplemental claims if they find additional damage or increased costs after their original claim amount was paid,” Commissioner Donelon commented.

These figures represent insurance claims from both personal and commercial insurance lines, some of which will have been covered by reinsurance for the affected carriers.

They do not include claims or payments from the National Flood Insurance Program, or uninsured losses and what was retained by policyholders to cover policy deductibles, meaning the true costs of the hurricane season to Louisiana will be much higher.

The 2020 storm season was the most active ever in history for Louisiana, with the three hurricanes as well as tropical storms Cristobal and Marco.

The 2020 storm season was also the second most expensive for Louisiana, after the 2005 storm season.

Hurricane Laura from 2020 has now displaced Hurricane Rita from 2005 as the second most costly storm in Louisiana history, though.

Hurricane Laura drove 175,160 claims, of which insurers have now closed 86%, 68% of which were closed with payment.

Total paid losses plus reserves for hurricane Laura have now reached $8.6 billion for Louisiana, making up most of the 2020 season’s impacts.

86,043 claims from Hurricane Delta have been recorded, of which insurers have closed 91%, and 62% of were closed with payment.

In total, insurers have paid or reserved $870 million to cover losses for Hurricane Delta.

Finally, hurricane Zeta saw 55,676 claims recorded, of which insurers had closed 93%, and 59% of those claims were closed with payment.

Total paid losses and reserves for hurricane Zeta amounted to $600 million as of June 30th 2021.

The state’s Louisiana Citizens Property Insurance Corporation, the non-profit state mandated insurer of last resort, saw the hit to its portfolio from recent hurricanes significantly softened by its reinsurance program.