NEW YORK (Bloomberg) — Hurricane Ike, the storm that forced evacuations in Texas two days ahead of expected landfall, will cause at least $5 billion in insured damage, said Steve Smith, an atmospheric physicist for the Carvill reinsurance broker.

The storm tripled in size as it advanced across the Gulf of Mexico, and was blowing at hurricane force in an area 230 miles across, the National Hurricane Center said. The size means it is likely to hit Houston and the oil-producing infrastructure in Galveston, which account for about three-quarters of possible insured losses in the state, Smith said.

"This is going to be the worst storm we've seen in a couple years," said Smith, the president of Carvill's Property Solutions advisory unit. "Five billion is the absolute floor. If this thing intensifies, the figure could easily reach $10 billion to $15 billion."

Ike follows Hurricane Gustav, which struck Louisiana as a category two on September 1, and Hanna, the tropical storm that made its way up the Eastern seaboard on September 6. The storms may reduce profits for insurers including Allstate Corp. and Travelers Cos. which benefited from calm weather in 2007 and 2006 after Katrina caused a record $41.1 billion of losses in 2005.

"Most companies should end up with profits lower" in the third quarter compared with a year earlier, said Paul Newsome, an insurance analyst with Sandler O'Neill & Partners in Chicago. "Falling insurance prices were already cutting into profitability, and this won't help."

A $5 billion hurricane would be among the 10 most costly to strike the US. Such a storm in Texas may cost Zurich Financial Services AG, which insures commercial property and homes through its Farmers Insurance Group unit, about $697 million, Newsome said in a note to investors yesterday. It could result in about $635 million in claims for Allstate, the largest publicly traded home insurer, Newsome said, based on 2007 market share data.