NEW YORK (Bloomberg) — Hurricane Gustav, the storm that hit Louisiana yesterday, will trigger insurance claims "significantly smaller than Katrina," said Robert Muir-Wood, head of research for Risk Management Solutions Inc.

The hurricane will cause "a few billion" of insured losses, Muir-Wood said in an interview on Bloomberg television. Newark, California-based RMS specialises in projections for catastrophes. Katrina caused a record $41.1 billion of insured losses in 2005.

Gustav is the first test since 2005 of the insurance industry's efforts to reduce losses in catastrophe-prone regions. Allstate Corp. and State Farm Mutual Automobile Insurance Co., the two largest US home insurers, were among companies that stopped taking on new policyholders in several states along the Gulf and East coasts in the months following the damage caused by Hurricanes Katrina, Rita and Wilma.

Many Bermuda insurers and reinsurers suffered huge losses from the 2005 storms and most have significantly reduced their exposure in the Gulf area since.

"They've skirted a big one," Muir-Wood said. "There will be fairly significant losses, I would say, but actually it's not going to be nearly the level of destruction we saw in 2005."

Gustav weakened to a category two storm by the time it reached land at about 10 a.m. local time in Louisiana southwest of New Orleans, which was evacuated in advance of the storm. Gustav's winds were close to 110 miles an hour as it came ashore and slowed to about 90 miles an hour as of 2 p.m.

Eqecat Inc., a risk-modeling firm in Oakland, California, said onshore insured losses may range from $6 billion to $10 billion, primarily in Louisiana. The storm may have caused $1 billion to $2 billion in insured damage offshore, said Steve Smith, an atmospheric physicist with Carvill Group, a reinsurance brokerage.

"The area it hit has a good population of rigs," Smith said. "It wasn't too bad for the Gulf oil field."

Insurers of oil platforms in the Gulf of Mexico have followed companies selling property coverage onshore in attempting to limit their losses. American International Group Inc., Zurich Financial Services Group AG and Liberty Mutual Group Inc. were among insurers that raised prices fivefold and capped how much they'll insure after Katrina and Rita caused record offshore claims estimated at $8 billion in 2005.

"We tend to remember and fight the last war," said Steve Maloney, a risk management consultant for Stamford, Connecticut- based Towers Perrin. "People went into this one rightfully worried that this might become another Katrina. Thankfully, there will be far less disruption than the last time."

Katrina became the most expensive disaster in US history when it came ashore three years ago. No major storms have made landfall in the US since Wilma capped the storm season later that year by causing an additional $10.3 billion in insured losses.

Data on insured losses may understate actual costs because the figures don't include damage to uninsured property or destruction caused by actions excluded from some policies, such as flooding.