Insurers’ losses from Hurricane Beryl will be “low and readily absorbed” and the storm is not expected to change pricing conditions in the property/casualty and reinsurance sectors, Moody’s Ratings said.
Beryl made landfall along the Texas coast as a category 1 hurricane on July 8, bringing strong winds and storm surge to much of the Texas Gulf Coast. Parts of east central Texas received 10 to 15 inches of rainfall.
Catastrophe modeling company Karen Clark & Co. said that insurers may take a hit of about $2.7 billion from damage caused by the storm.
CoreLogic estimated insured wind losses in Texas of between $2.5 and $3.5 billion. The estimated losses include damage to residential, commercial, industrial, and agricultural properties, including damage to contents and business interruption, CoreLogic said. The estimate includes demand surge.
Most Texas homeowners have deductibles between 1% and 5%. A shift towards the purchase of a higher deductible amount could significantly reduce the losses paid by insurers, CoreLogic said.
Over 31,000 commercial real estate properties in Texas were expected to be exposed to winds of at least 50 mph, according to Natalie Ambrosio Preudhomme, associate director-commercial real estate, Moody’s. The cumulative estimated value of those properties is over $160 billion.
“This demonstrates that while major damage to many assets is likely to be minimal, it is also likely that thousands of properties face minor repairs, some of which may not be severe enough to meet their insurance deductibles,” said Preudhomme.
Beryl is the earliest category 5 Atlantic hurricane on record. The storm battered the Grenadines on July 1 before passing Jamaica on July 5.
The storm caused minimal damage to central Yucatan Peninsula as a landfalling category 2 hurricane. Beryl then emerged into the Gulf of Mexico and regained hurricane status just before landfall at Matagorda, Texas.
Topics Catastrophe Natural Disasters Carriers Profit Loss Hurricane
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