RMS Estimates Hurricane Ida Losses

RMS®, the world’s leading catastrophe risk solutions company, estimates onshore and offshore U.S. insured losses from Hurricane Ida in the Gulf of Mexico to be between US$25 and US$35 billion. The estimate includes losses to the National Flood Insurance Program (NFIP) in the four impacted Gulf Coast states (Alabama, Florida, Louisiana and Mississippi) in the range of US$2.3–$4 billion.

This estimate includes wind, storm surge, and inland flood losses across only the impacted Gulf states in the landfall region  Alabama, Florida, Louisiana and Mississippi — based on analysis of RMS ensemble footprints in Version 21 of the RMS North Atlantic Hurricane Models and estimates from the RMS U.S. Inland Flood HD Model. RMS ensemble footprints are reconstructions of Ida’s hazard that capture the uncertainties surrounding observed winds and storm surge. This estimate excludes wind and inland flooding impacts in Ohio Valley, Mid-Atlantic, and Northeast U.S. regions, which will be communicated in the coming days once the full extent of damage is known.

PROPERTY DAMAGE 

Losses reflect property damage and business interruption to residential, commercial, automobile, industrial, infrastructure, marine cargo and specie, watercraft, and other speciality lines of business, along with post-event loss amplification (PLA) and non-modeled sources of loss.

“Ida was near Category 5 intensity at its landfall and remained for six hours at Category 4 intensity moving inland. The buildings and infrastructure in this region have never experienced such a strong hurricane wind intensity. Due to major damage to power plants, as well as transmission and distribution lines, the widespread power outage will significantly delay full recovery. We expect material impacts to specialty lines from this event. Southern Louisiana has a high concentration of petrochemical plants, refineries, marine cargo and port exposures, power plants and other high-value industrial facilities that were impacted by Ida. These businesses rely heavily on the state’s power grid. With prolonged anticipated recovery times, we expect material business interruption losses to these lines on top of varying degrees of infrastructure damage they sustained,” said Mohsen Rahnama, Chief Risk Modeling Officer, RMS.

The estimate also includes US$2.3–$4 billion losses to the National Flood Insurance Program (NFIP) in the Gulf Coast states. NFIP losses were derived using RMS’ view of NFIP exposure based on 2019 policy-in-force data published by FEMA, the Version 21 North Atlantic Hurricane Models, and the U.S. Inland Flood HD Model.

RMS expects insured wind losses in this event to be driven by residential lines, and insured water-related losses to be dominated by commercial and industrial lines.

Additionally, RMS estimates insured losses to offshore platforms, rigs, and pipelines in the Gulf of Mexico to be between US$0.7–$1.5 billion from wind and wave-driven damages. Offshore losses are based on the August 2021 vintage of the RMS Offshore Platform Industry Exposure Database.

Hurricane Ida was the ninth named storm of the 2021 North Atlantic hurricane season, the fourth hurricane, and the fifth named storm to make landfall in the U.S. this season. Ida was also the fourth hurricane to make landfall in Louisiana since 2020, following Hurricanes’ Laura, Delta, and Zeta. Over two months still remain in the 2021 North Atlantic hurricane season, officially ending on November 30.

RMS industry loss estimates for landfalling U.S. hurricanes are comprehensive, reflecting modeled and non-modeled impacts from all major drivers of damage, including wind, storm surge, and inland flooding.

About alastair walker 6830 Articles
20 years experience as a journalist and magazine editor. I'm your contact for press releases, events, news and commercial opportunities at Insurance-Edge.Net

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