In the aftermath of hurricanes Helene and Milton, which has left a trail of destruction across southern US states, GlobalData notes that insurers should expect to witness a higher number of claims in 2024 across general insurance lines.
According to the Office of Insurance Regulation, over 112,926 insurance claims for Hurricane Helene have been filed as of 9 October 2024. This could significantly impact profitability, with insured losses already estimated to amount to US$1.1 billion.
Of these claims, around 52,000 relate to private passenger vehicles whilst 50,672 are residential property claims. These residential property claims are expected to account for 12.9 per cent of total general insurance claims, although once the complete impact of both hurricanes is fully realised, this number can be expected to rise dramatically.
Commenting on the damage caused by the hurricanes, insurance analyst at GlobalData, Manogna Vangari, states: “Hurricane Milton was a formidable storm that resulted in a landfall to the south of Tampa Bay, near Siesta Key, leading to multiple tornadoes, particularly across South Florida. According to the White House briefing, the damage from Hurricane Milton is estimated to be more than US$50 billion.”
The storms have further highlighted deficiencies within the US flood insurance framework. Standard homeowners’ policies do not include flood coverage and often must be acquired as a separate policy directly from the federal government.
As a result, only 6 per cent of homeowners possess flood insurance. With the severity of flooding increasing along with the frequency of the storms, the need for comprehensive flood risk management is urgent.
Vangari concludes: “The recent spate of natural disasters may result in higher-than-anticipated claims for US insurers and reinsurers in 2024 and 2025. The escalating incidence of such significant events is projected to drive the need for a comprehensive flood risk cover.”
