Hurricane Michael, which hit Florida's Panhandle region, may cost
insurance companies about
$8 billion, risk modeler Karen Clark & Co.
(KCC) estimates. That figure includes wind and storm surge damage to
homes, cars, and industrial and commercial properties covered by
private insurers, the company says. KCC estimates that about half of
those losses occurred in Bay and Gulf counties; its figure does not
factor in losses backed by the National Flood Insurance Program (NFIP).
Michael is the strongest hurricane to hit the U.S. mainland in decades,
leaving thousands without power. Most of the damage came from strong
wind speeds and the storm surge depths ranged from 9 to 14 feet along
the most impacted area of the cost, KCC said. Storm surge caused
$3.7 billion in total damages and about 10 percent of that figure
is insured.
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The Property Casualty Insurers Association of America (PCI) initially
estimated that insured losses could range from $2 billion to
$4.5 billion. Hurricane Irma, by contrast, caused just over
$10.4 billion in insured losses in Florida alone, according to the
Florida Office of Insurance Regulation.
A.M. Best said it does not anticipate a large number of rating
actions related to Michael, as catastrophic events such as this one
already have been considered in insurance companies' current ratings
and outlooks. Insurers with the largest market shares in U.S. states
to be hit by Michael have considerable exposures, but these are
manageable given each company's overall policyholder surplus, it said.
