MS Amlin has warned that the United States is still exposed to a major hurricane threat this year despite forecasts for a quieter Atlantic season, estimating a 27 per cent chance that a Category 4 or 5 storm will make landfall in the country.

The Swiss-based reinsurer with a branch office in Bermuda said the probability is down from 39 per cent a year ago as strengthening El Niño conditions could suppress hurricane activity in the Atlantic basin.

MS Amlin's annual hurricane forecast projects a below-average season, with 11 named storms, five hurricanes and two major hurricanes, compared with long-term averages of 14.4 named storms, 7.2 hurricanes and 3.2 major hurricanes.

The reduction in risk is being driven largely by a sharp fall in the probability of a Category 4 or 5 hurricane striking the Gulf Coast. According to the forecast, the likelihood of such a storm making landfall in the Gulf region has fallen to 10 per cent from 19 per cent last year.

Florida is still one of the most exposed areas, however. The probability of a Category 4 or 5 hurricane making landfall in the state declined more modestly, from 19 per cent to 14 per cent.

Sam Phibbs, head of catastrophe research at MS Amlin, warned that the numbers do not reflect an absence of risk.

“A one-in-four chance of a Category 4 or 5 US hurricane landfall is lower than we were seeing a year ago, but it’s still far from negligible,” Mr Phibbs said. “It only takes one storm to turn a quiet season into a costly one for communities and insurers.”

For Bermuda's reinsurance market, the findings point to the importance of landfall risk rather than storm counts alone. A relatively quiet season can still generate substantial losses if a powerful storm strikes a heavily populated or economically important area.

Atlantic hurricanes are the single largest source of catastrophe exposure for the Bermuda market. Average modelled losses from Atlantic hurricane events ranged from about $1.1 billion for a one-in-50-year event to more than $2 billion for the most extreme scenarios.

MS Amlin pointed to last year's Hurricane Melissa, which rapidly intensified into a Category 5 storm before making landfall in Jamaica and causing an estimated $8.8 billion in economic damage, despite no hurricanes making landfall in the US.