hurricane Milton 2024

Analysts in the J.P. Morgan European equity research team have said that if hurricane Milton’s industry impact comes in between $20 billion and $40 billion, they “don’t see Milton driving a reinsurance market turn” in 2025.

So far, based on analysis of the catastrophe bonds in the UCITS structure that have priced their net asset value (NAV) since hurricane Milton struck Florida and where we have been able to access that data, the average mark-down across the funds is just -0.77%.

Hurricane Milton is estimated to have caused total insured losses of between $17 billion and $28 billion, CoreLogic has said, with this figure including losses to the NFIP, bringing the firm’s estimate in towards the lower-end of those seen so far.

Moody’s RMS Event Response has estimated that private market insured losses from hurricane Milton will fall in a range between $22 billion and $36 billion, with a best estimate of $26 billion.

HCI Group, the Florida-focused insurance holding company, said it expects to pay between $600 million and $750 million in claims for hurricanes Debby, Helene and Milton, but net retained losses from the three events could be as low as $185 million.

Another estimate for insurance and reinsurance industry losses from hurricane Milton has been released, with Verisk saying it anticipates the private market insured loss will fall in a range from $30 billion to as much as $50 billion.

Having shown a divergence in manager strategies as NAVs moved in different directions at times and by different amounts as hurricane Milton approached, the US mutual investment funds that allocate to catastrophe bonds and other insurance-linked securities (ILS) diverged again at pricing on Friday, but have since stabilised having incorporated post-landfall net asset value adjustments.

Catastrophe bond fund manager Icosa Investments has highlighted current uncertainty over the level of losses the market may face from hurricane Milton, but notes that while some principal losses seem likely there remains a high level of uncertainty over certain structures, especially aggregate cat bonds that have much of their risk periods left to run.

Progressive, the US primary insurance giant, has reported in its September results that it does not anticipate per-occurrence reinsurance recoveries from either hurricane Helene or hurricane Milton based on its estimates for losses at this time, but they could have implications for its aggregate cover, including its catastrophe bonds.

The insurance industry loss from hurricane Milton in the US from wind, storm surge, and inland flooding has been estimated at close to $36 billion by Karen Clark & Company (KCC), although this excludes insured damage to boats, offshore properties, and losses to the National Flood Insurance Program (NFIP).