RMS says insured Laura loss could reach $13bn
Catastrophe modeller RMS has estimated onshore insurance industry losses related to Hurricane Laura will range between $9 billion and $13 billion — suggesting that Bermudian reinsurers will face substantial claims.
The estimate is markedly higher than that of another modeller, AIR Worldwide, which estimated onshore insured losses of between $4 billion and $8 billion earlier this week.
Laura made landfall made landfall near Cameron, Louisiana, close to the Texas border, on August 27 as a Category 4 storm, bringing powerful winds, around 15 feet of storm surge, and widespread heavy rain across the Gulf region.
The RMS estimate includes losses to the National Flood Insurance Programme of between $400 million and $600 million.
RMS estimates an additional $1 billion to $2 billion of insured losses to offshore platforms, rigs, and pipelines in the Gulf of Mexico, due to wind and wave-driven damages.
Jeff Waters, senior product manager, RMS North Atlantic Hurricane Models, said: “Although Laura avoided major metropolitan areas like Houston and New Orleans, it was still an extremely impactful US event.
“After making landfall as a powerful Category 4 storm, it maintained its intensity as it moved inland, causing widespread wind and water-driven damage well into interior portions of Louisiana.
“The extent and severity of these damages has been verified by our development teams via web and aerial-based reconnaissance efforts.”
Losses reflect property damage and business interruption to residential, commercial, industrial, and automobile lines of business, as well as post-event loss amplification and non-modelled sources of loss. Industrial losses include impacts to speciality lines, such as refineries and petrochemical plants, many of which lie along this part of the Gulf coastline.
Pete Dailey, vice-president, model development at RMS said offshore assets had evolved significantly since hurricanes Katrina and Rita in 2005 and Ike in 2008, but that there were still many platforms, rigs and pipelines in the Gulf region.
He added: “Many of these assets, including several high-value deepwater platforms, were exposed to the significant wind and wave impacts from Hurricane Laura. At landfall, Laura produced devastating sustained winds of 150mph, according to both the National Hurricane Centre and RMS HWind forecasting service.”