Matthew May Cost Insurers as Much as $8.8 Billion, AIR SaysBy
Reinsurers say it’s yet too early to estimate their claims
U.S. insured losses seen at $2.2 billion to $6.8 billion
Hurricane Matthew, which devastated parts of the Caribbean before battering the U.S. East Coast, may cost insurers as much as $8.8 billion, according to AIR Worldwide.
Insured losses range from $2.2 billion to $6.8 billion for the U.S. and from $600 million to $2 billion for the Caribbean, the catastrophe-modeling firm estimates
Matthew left hundreds of people dead in Haiti and killed at least 15 in the U.S., causing damage in Florida, Georgia, South Carolina, North Carolina, and Virginia.
The total is a fraction of the worst-case estimates made last week as the storm neared the Florida coast and Matthew wouldn’t make it into the top 10 of the costliest disasters for insurers and the reinsurers who help them shoulder risks.
Hurricane Matthew made landfall in Haiti on Oct. 4 as a category 4 Hurricane, the second-strongest on the Saffir-Simpson scale. It’s Haiti’s largest humanitarian catastrophe since the earthquake in 2010, according to the United Nations.
CCRIF SPC, formerly known as the Caribbean Catastrophe Risk Insurance Facility, said it’s preparing a payout of about $20 million to the government of Haiti, it’s highest ever. The fund’s sponsors include the governments of Canada, the U.K., France, Ireland and Bermuda, as well as the World Bank and the Caribbean Development Bank.
The closest the storm’s center got to onshore properties in Florida was 25 miles (40 kilometers) east of Cape Canaveral, “where NASA’s rocket-launch facility experienced damage to roofs, windows and siding, as well as some water intrusion,” AIR said in an e-mailed statement.
The Atlantic hurricane season, which runs from June through November, can result in the insurance industry’s biggest losses. It typically sees the most activity from mid-August to mid-October.
The industry’s most expensive natural disaster so far was Hurricane Katrina, which devastated New Orleans in 2005 and led to $60.5 billion in claims, according to data by German reinsurer Munich Re.