Debby, downgraded to a tropical storm Tuesday, is expected to bring as much as 25 inches of rain and more flooding to parts of the Carolinas this week, exacerbating uninsured flood damage but keeping wind losses within limits.
Moody’s, a global financial rating and analytics firm, said the insured losses from the storm would fall within primary insurers’ reinsurance retentions.
“In general, primary insurers are retaining more risk this hurricane season as attachment points – the threshold at which a policy begins to cover a loss – have moved higher over the past few years, with primary companies taking on more of the loss burden from reinsurers for small to midsize catastrophe events,” James Eck, vice president and senior credit officer at Moody’s, said in a statement Tuesday.
That could be seen as some relief for property insurers, especially in Florida, where Debby made landfall as a Category 1 hurricane early Monday morning. Florida’s insurance market is the most reliant on the global reinsurance market, compared with all other U.S. states, Moody’s said in a separate report last week. And losses from hurricanes and excessive litigation in Florida in recent years have sharply raised reinsurance costs and forced limits on availability.
The rain-heavy storm, not unlike Hurricane Idalia that followed a similar path almost a year ago, brings other costs, Moody’s noted.
“The economic costs of Debby are mounting due to factors such as road closures, flight cancellations, power loss, business closures, and foregone tourism,” said Chris Lafakis, chief Economist at Moody’s Analytics. “Physical destruction from high wind speeds is by no means the only channel through which tropical cyclones exact a toll on economic activity.”
Meanwhile, insurance agents in Charleston, South Carolina, which was almost in the direct path of Debby, reported widespread flooding in the area – but few claims had been filed by Wednesday morning.
“It’s wet. A lot of rain right now,” said a manager with Anderson Insurance Associates.
Few places in South Carolina are as susceptible to flooding as Charleston, the Associated Press reported. Much of the city, founded in 1670, was built on land created by using fill dirt and other debris. Rising sea levels cause a number of minor flooding events even without a storm and, like many coastal cities, water in Charleston does not drain quickly.
Bloomberg news service reported that flood watches and warnings had been issued for much of the Carolinas, after Debby inundated parts of north Florida and southeast Georgia. The St. Marys River in northern Florida rose more than 10 feet in 24 hours, according to the National Weather Service. The Ohoopee River in Georgia was forecast to rise more than 15 feet, approaching a record high, Bloomberg noted.
Nearly 162,000 customers were reported to be without power Tuesday in Florida, Georgia, and South Carolina, according to PowerOutage.us. But Duke Energy said that power had already been restored by late Tuesday to 90% of its customers in Citrus, Hernando, Lake, Levy, Marion and Sumter counties in northern Florida, Reuters news agency reported.
Photo: Hershey Stepherson, left, and Bryan Burc, right, fill sandbags while preparing for Hurricane Debby in Savannah, Georgia. (AP Photo/Stephen B. Morton)
Topics Profit Loss Flood
Was this article valuable?
Here are more articles you may enjoy.
Miami’s ‘Impossible’ Traffic Mess Shows Strains of Booming South 
Midwestern Farmers Who Say Yes to Solar Power Face Neighbors’ Wrath 
CrowdStrike Rejects Delta Air Lines Claims Over Flight Woes 
Hurricane Debby Brings Six Deaths, Widespread Flood Losses in Florida, Georgia, SC 
