As Hurricane Irma’s winds dissipated, the insurance industry began to take stock of the fallout. Damage estimates from Hurricane Irma have come rolling in, with projected total insured losses ranging from $20 billion to $40 billion.
Irma has continued to take a toll, with reports of several deaths at a nursing home in Hollywood, FL. The recovery process, both in terms of damage, economic impact, and insurance claims, will be long and involved, with resources stretched to their limits, according to government officials and insurance industry observers. The business interruption, property damage, and auto losses will require extensive claims handling, despite the insurance industry’s strong capital position.
AIR Worldwide, the Boston-based catastrophe modeling firm, predicted losses ranging from $20 billion to $40 billion, in an area stretching up the western coast of Florida where exposure is estimated at $1 trillion.
“Nearly the entire state of Florida has been subject to strong winds and torrential rains, and very dangerous storm surge,” reported AIR. “Hurricane Irma lashed the Florida Keys with extreme winds and torrential rains, its center passing just 20 miles east of the popular tourist destination of Key West.”
AIR’s insured loss estimate does not include infrastructure damage, National Flood Insurance Program (NFIP) claims, inland marine, or cargo and hull, but do include wind and storm surge damage to residential and commercial properties, contents, automobiles, and associated claims such as additional living expenses and business interruption.
Karen Clark of Karen Clark & Company, predicted US and Caribbean losses of $25 billion.
“Hurricane Irma caused the most devastation in the Keys, particularly to the east of the Cudjoe Key landfall. These areas experienced the full brunt of 130 mph winds along with significant flooding,” said Clark. “Because Irma weakened significantly after crossing Cudjoe Key and before impacting the southwestern coast, the storm surge was much less significant in Naples, Fort Myers, and Tampa than initially feared.”
Irma lost strength quickly after the second landfall, Clark reported, with most structural damage caused by falling trees. Wind impacts were limited to mobile homes, lighter structures, signs, and some roof and window damage. However, the size of the storm meant that much of the state of Florida experienced wind damage.