Economy

This is how many millions Hurricane Irma will cost insurers

This is how many millions Hurricane Irma will cost insurers”

Hiscox said the devastation wreaked by Hurricane Harvey on the United States will cost the insurer $150m (£110m) in claims.

Harvey sparked widespread flooding in Texas around Houston and has been followed by Hurricane Irma, which swept through the Caribbean before hitting Florida.

It said this is within the company's modelled range of claims for an event of this nature, and said reinsurance protection for Hiscox remains "substantially" intact.

Hiscox, based in Bermuda, said that it was exposed to Harvey through its reinsurance business as well as primary insurance lines, including flood coverage for homeowners and businesses.

The Insurance Council of Texas (ICT) has placed Hurricane Harvey insured losses at $19 billion, $11 billion of which is expected to be paid out by the NFIP flood insurance, making the hurricane the second highest on record for flood damage after hurricane Katrina.

The first major Hurricane to hit landfall in the USA in over 12 years, Harvey unusually stalled over Houston creating a prolonged period of flooding for the region.

Shore Capital analyst Eamonn Flanagan noted that the loss from Harvey equated to about 6 percent of Hiscox's net tangible asset value as at the June end.

The worldwide specialist calculated the estimate based on an insured market loss of £18 billion (US$25 billion), excluding the government backed National Flood Insurance Program, it said in a release. "We expect Hiscox to trade down today and expect uncertainty to persist around Beazley and Lancashire who are yet to publish their own estimates", Keefe, Bruyette & Woods analyst Rufus Hone, said, referring to other Lloyd's of London insurers.



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