CoreLogic, a leading global property information, analytics and data-enabled solutions provider, has revealed that estimated losses from Hurricane Ian will total between $28bn in $47bn, warning some insurers will go bankrupt.
According to the data analysis, wind losses for residential and commercial properties in Florida are expected to be between $22bn and $32bn.
Insured storm surge losses in Florida are expected to be an additional $6 billion to $15 billion.
If forecasts hold steady, CoreLogic said it expects Hurricane Ian to continue bringing flash flood devastation across Florida and potentially into South Carolina and Georgia .
Residents will experience standing water and sewer backups for days, slowing immediate recovery. Significant infrastructure damage will also impede local governments’ ability to respond.
The recovery in the aftermath of the storm will shine a spotlight on catastrophe risk response.
With inflation in the US at a 40-year high, interest rates nearing 7% and labor and materials in high demand, CoreLogic warned the recovery will be slow.
Tom Larsen, associate vice president, hazard & risk management at CoreLogic, said, “This is the costliest Florida storm since Hurricane Andrew made landfall in 1992 and a record number of homes and properties were lost due to Hurricane Ian’s intense and destructive characteristics.
“Hurricane Ian will forever change the real estate industry and city infrastructure. Insurers will go into bankruptcy, homeowners will be forced into delinquency and insurance will become less accessible in regions like Florida.”
However, Larsen predicted that infrastructure and building codes may evolve as a result of storm Ian, so that the region is more resilient in the future. Amid growing prevalence of extreme weather events linked to climate change, this is more important than ever.
Natural catastrophe response is an evolving area in insurance. Parametric insurance has been presented as one solution for enabling fast responses. Earlier this year, K2 Parametric Insurance Services, a subsidiary of K2 Insurance Services, partnered with Homesite Underwriting Managers to offer parametric natural catastrophe policies in the US.
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