Report predicts $65 billion insurance industry loss from Irma

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Global catastrophe risk modeller, AIR Worldwide, has released an estimate for the insurance industry loss for Hurricane Irma for the U.S. and selected Islands in the Caribbean, of between $20billion and $65 billion, combined.

The report estimates an insurance industry loss of between $15 billion and $50 billion as a result of wind and storm surge from hurricane Irma, which was on track to hit Florida last Sunday morning.
For selected Islands in the Caribbean, the modeller estimates that Irma’s wind and precipitation-induced flooding will drive an estimated insured loss of between $5 billion and $15 billion.
AIR notes that these estimates are based on the NHC’s Saturday, September 9th 5am EDT forecast advisory for major hurricane Irma.

The intensity of the storm as it approaches the U.S. coastline is subject to change, but it is expected to intensify from its current Category 3 status to a Category 4 storm as it nears the Florida coast.

Parts of the Caribbean have already been battered by the storm, and now hurricane and storm surge warnings are in place for the Bahamas and Florida.

“At least two nuclear plants in Florida were shut down as a precautionary measure: the Turkey Point plant and the St. Lucie plant. The U.S. Army Corps of Engineers drew down the levels in Lake Okeechobee and inspected the dam for safety. The South Florida Water Management District lowered water levels in canals as they plan for flooding and storm surge dangers.

“The Georgia governor declared a state of emergency in at least six coastal counties, and issued mandatory evacuation orders for the City of Savannah and surrounding Chatham County,” explains the report.

Concerns have also been raised for cotton fields in North and South Carolina and Texas, which could experience additional damage soon after a reported $150 million hit from hurricane Harvey.
80percent of Florida’s total insured value is in coastal counties, which suggests that the insured loss for Irma could be higher than seen with Harvey, owing to a lack of insurance penetration in the region, especially surrounding flood, which is expected to make up the majority of Harvey losses.

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