Looks Like A Tough Hurricane Season

[SafetyinNumbers]

Some estimates are for as high as $110b now but not sure what portion of that will be insured.

 

https://www.inc.com/reuters/hurricane-helene-damages-range-between-95-110-billion.html

[Parsad]

13 hours ago, SafetyinNumbers said:

Some estimates are for as high as $110b now but not sure what portion of that will be insured.

 

https://www.inc.com/reuters/hurricane-helene-damages-range-between-95-110-billion.html

 

I think that Accuweather estimate is way higher than what the losses will be.  The $5B number someone provided earlier was far too low, but I think this thing is in the $35-50B range of losses. 

 

A ton of water damage occurred which tends to make losses higher.  But over $100B would be excessive as it missed most major cities.  A few degrees this way or that and I could see it hitting the $100B+ number, but we got a bit lucky believe it or not.  It also weakened dramatically as it hit land, but that meant more rain damage and less wind damage. 

 

Cheers!

[Parsad]

1 minute ago, Parsad said:

 

I think that Accuweather estimate is way higher than what the losses will be.  The $5B number someone provided earlier was far too low, but I think this thing is in the $35-50B range of losses. 

 

A ton of water damage occurred which tends to make losses higher.  But over $100B would be excessive as it missed most major cities.  A few degrees this way or that and I could see it hitting the $100B+ number, but we got a bit lucky believe it or not.  It also weakened dramatically as it hit land, but that meant more rain damage and less wind damage. 

 

Cheers!

 

Here you go...a reasonable estimate from a group that specialize in this:

 

https://www.artemis.bm/news/hurricane-helene-economic-loss-in-20bn-34bn-range-moodys-analytics/

 

I personally think it will be on the high side of that estimate...there was considerable water damage in a very large swath of territories.  Cheers!

[glider3834]

3 hours ago, Parsad said:

 

Here you go...a reasonable estimate from a group that specialize in this:

 

https://www.artemis.bm/news/hurricane-helene-economic-loss-in-20bn-34bn-range-moodys-analytics/

 

I personally think it will be on the high side of that estimate...there was considerable water damage in a very large swath of territories.  Cheers!

looks like Moodys insured loss estimate still to come

 

'In terms of insured losses, Moody’s says it remains too early to put a precise cost on the storm, but the Moody’s RMS Event Response team will be releasing an estimate in the coming weeks.'

 

It looks like Gallagher re have upped their estimate for insured loss range to mid to high single digit billions  https://www.artemis.bm/news/hurricane-helene-private-insurance-loss-seen-mid-to-high-single-digit-billions-bowen-gallagher-re/ & made these comments 

 

'The overall economic loss is going to be well beyond $10 billion. Very limited flood insurance take-up in far inland areas is going to mean a large portion of damage will be uninsured. NFIP coverage limits (Residential: $250k structure / $100k contents + Commercial: $500k structure / $500k contents) will in many cases mean properties will not be fully insured against incurred damage. The gap between the overall direct economic cost and the portion covered by private / public insurance for Helene will be sizeable; similar to other historical flood-driven hurricane events.'

 

 

Edited September 30 by glider3834

[Hoodlum]

While not impacting reinsurance directly, the scale of the water damage was massive.

 

https://www.artemis.bm/news/hurricane-helene-floods-over-100k-buildings-at-least-10k-to-over-5-feet-iceye/

 

Quote

According to analysis from ICEYE, the provider of satellite data and services to inform decision-making and analysis, hurricane Helene’s flooding saw over 100,000 buildings impacted, with more than 10,000 of those being inundated to flood depths of greater than 5 feet.

 

[Hoodlum]

I periodically look at the daily Atlantic Sea temperature to look for any trends.  I noticed today that the data hasn't been updated since last week and then noticed the following tidbit on that site.  I guess they never had any disaster recovery plan.  I don't think we will see data being updated for a while as Ashville was heavily impacted.

 

https://climatereanalyzer.org/clim/sst_daily/?dm_id=world2

 

Quote

The OISST data on this page are sourced from the National Centers for Environmental Information (NCEI) data center located in Asheville, North Carolina, one of many communities severely impacted by heavy rainfall and historic flooding associated with Hurricane Helene. The NCEI data center has been offline since September 27th, and it is uncertain when service can be restored.

 

[SharperDingaan]

You might want to keep in mind that while this was bad, it would seem to just be the start for the US/Canadian East Coast. It is now an above average season, Kirk and Leslie are on their way, the Atlantic is still very warm, and there is still 2 months to go. https://ca.news.yahoo.com/2024-atlantic-hurricane-season-officially-142154996.html

 

Sadly, there is a need to make projection. Assume a 35B loss on this event, plus another similar event for each of the next 2 months (conservative?); and cumulative losses could well exceed 1B+ before Christmas.

 

Should FFH have around 1% of the loss ...  around year-end there's an extraordinary announcement of 100M+ in related charges. Thereafter FFH goes ex-dividend around Jan-17, further lowering the share price an additional USD 15. Hence, we have put our swing trade on.

 

Hopefully we've overly pessimistic.

 

SD

 

 

[dartmonkey]

37 minutes ago, SharperDingaan said:

Sadly, there is a need to make projection. Assume a 35B loss on this event, plus another similar event for each of the next 2 months (conservative?); and cumulative losses could well exceed 1B+ before Christmas.

 

Should FFH have around 1% of the loss ...  around year-end there's an extraordinary announcement of 100M+ in related charges. Thereafter FFH goes ex-dividend around Jan-17, further lowering the share price an additional USD 15. Hence, we have put our swing trade on.

 

Hopefully we've overly pessimistic.

I should say. Insured losses for Helene are currently estimated at $6.5b, with not much preceding it, and we are 2/3 of the way through the season, so a central estimate of about $100b for the whole season does seem a tad on the high side.

[cwericb]

Just my 2 cents worth, but it looks like Kirk and Leslie are headed north towards Europe and should settle down before doing any serious damage. Also, a serious hurricane in November would be somewhat of a rarity, however waters are warmer. Since hurricanes are now travelling further north, if we can just get a hard frost it will take a lot of the leaves off the trees and that would considerably reduce damage, plus a lot of the weaker trees have already fallen from previous hurricanes. The optimistic view.

[SharperDingaan]

We just see it as a grey swan ....  an event that is known and possible to happen, but which is assumed to be unlikely to occur (Wikipedia). As being on the wrong side of the assumption could really screw up our day, a swing trade is just smart insurance.

 

A downgraded hurricane is still a lot of water/wind, no matter where it comes ashore. Atlantic Canada will be primarily covered by Canadian re insurers. The Canaries and the Azores are European holiday destinations akin to North America and the Caribbean, and will be primarily covered by European re insurers ...... significant weather events going north and east are still going to cost.   

 

All that one can really do is hope for the best,  prepare for the worst;

and try to always live on high ground away from the coast!.

 

SD

 

 

 

 

 

 

 

Edited October 4 by SharperDingaan

[Jaygo]

Next one looks like in has the Tampa Bay area as a possible landfall. 

 

[Hoodlum]

10 hours ago, Jaygo said:

Next one looks like in has the Tampa Bay area as a possible landfall. 

 

While still early, tropical storm Milton has now formed. They are currently projecting this to reach Category 3 and while this will be further south, the final path could still change. 

[Haryana]

https://www.insurancebusinessmag.com/ca/news/reinsurance/helene-highlights-gap-between-economic-and-insured-losses--guy-carpenter-508404.aspx

"Estimates for insured losses from Helene, a Category 4 hurricane, are in the single-digit billions, with Karen Clark & Co. reporting $6.4 billion in privately insured losses across nine states.

According to AM Best, this figure contrasts with economic losses, which are estimated in the triple digits."

[SharperDingaan]

1% of exposure is still 10M per billion of insured loss, and there are at least another 7+  weeks of this to go.

 

SD  

[Hoodlum]

Hurricane Milton is now Category 3 and expected to be a Category 4 hurricane later today and continue at that level for a couple days, until reaching the Florida coast as a Category 3 Hurricane.  This is also expected to be a very large/wide hurricane. I don't think I have seen a Hurricane come at Florida from this direction previously, although I am sure this is not the first time.   I suspect modeling will be challenging based on historical records.  Current path of hurricane center is Sarasota (just south of Tampa Bay), but that can change.

 

Central Florida has been receiving heavy rain the past couple days so the ground has not had a chance to soak up the water ahead of this Hurricane.  

[Jaygo]

This one is going to be a terrible mess. The current track lines right up to Tampa and right along through Orlando.

 

Looking at the barrier islands like anna maria, longboat key etc I just worry for all those old folks who live there. When we were there in February mentioned how vulnerable it all seemed. Just the fact that everything is connected by bridges and traffic was bad in a normal environment. The amount of neighborhoods that channel traffic through one little intersection and now the streets are clogged with junk from Helene. From bad to worse.

 

 

 

 

[Hoodlum]

1 hour ago, Jaygo said:

This one is going to be a terrible mess. The current track lines right up to Tampa and right along through Orlando.

 

Looking at the barrier islands like anna maria, longboat key etc I just worry for all those old folks who live there. When we were there in February mentioned how vulnerable it all seemed. Just the fact that everything is connected by bridges and traffic was bad in a normal environment. The amount of neighborhoods that channel traffic through one little intersection and now the streets are clogged with junk from Helene. From bad to worse.

 

 

 

 

I saw some video of the Tampa Bay area and was surprised by the huge amount of junk in front of houses.  That is going to get thrown around if not picked up in the next 24 hours.  Hurricane Milton has now jumped to category 5 level.   That was fast!

Edited October 7 by Hoodlum

[treasurehunt]

4 hours ago, Hoodlum said:

Hurricane Milton is now Category 3 and expected to be a Category 4 hurricane later today and continue at that level for a couple days, until reaching the Florida coast as a Category 3 Hurricane.

 

Milton now up to Category 5! I hope it weakens before landfall and spares the more populated areas in Florida.

[Grenville]

All the models and the youtube meterologist show it weaking closer to landfall. The windshear is supposed to weaken it. 

[backtothebeach]

So if the same house gets hit by 2 hurricanes within a couple of weeks, methinks the insurance pays only once, not twice...

[SharperDingaan]

2 hours ago, backtothebeach said:

So if the same house gets hit by 2 hurricanes within a couple of weeks, methinks the insurance pays only once, not twice...

 

... More likely that the insurance payout caps out at some maximum amount, irrespective of the amount of damage caused. Anything under the cap the insurer pays (maybe), anything above it the state pays (maybe), and for the months/years until payment is eventually received ... the site remains abandoned. 

 

... It also implies a number of insurer failures, as this kind of payout very likely wasn't adequately stress tested .... 'cause it could never happen! The bad news causing the tide for all insurers to wash out, lowering valuations across both the P&C and Re-Insurance sectors. 

 

SD  

Edited October 7 by SharperDingaan

[UK]

https://www.barrons.com/amp/articles/hurricane-milton-insurance-stocks-220b0d88

[KFRCanuk]

20 hours ago, backtothebeach said:

So if the same house gets hit by 2 hurricanes within a couple of weeks, methinks the insurance pays only once, not twice...

Isn't the end result the same? House destroyed or damaged anyway.

[Hoodlum]

On 10/7/2024 at 1:26 PM, Grenville said:

All the models and the youtube meterologist show it weaking closer to landfall. The windshear is supposed to weaken it. 

This hurricane took only 18 hours to go from category 1 to 5, the 2nd fastest development ever.  It is becoming more difficult to predict how these hurricanes develop. The last update is that Hurricane Milton is strengthening again and is just 2 kmh short of becoming a category 5 hurricane again. 

[Thrifty3000]

According to a quick google search:

 

- average home value in Florida: $400,000

- average annual cost of insuring a home in Florida: $11,000 (4 to 5 times higher than national average)

 

So, it looks to me like 1 in 40 homes in Florida can be wiped out every year and the insurers will still turn a profit.

 

There are 8 or 9 million houses in Florida, so if 100% were insured the insurance industry could afford to rebuild roughly a quarter million houses every year.

 

(Disclaimer: All my math is back of the envelope and probably wrong.)