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Moody’s estimates insurance losses from Hurricane Milton between $22-36 bn

Moody’s estimates insurance losses from Hurricane Milton between $22-36 bn

Moody’s RMS Event Response estimates private insurance losses from Hurricane Milton to range between $22 bn and $36 bn. This revision adjusts the combined insured loss estimate for Hurricanes Helene and Milton to a total of $30 bn to $50 bn.

For Hurricane Milton alone, the Moody’s released a best estimate of $26 bn, which accounts for insured losses from wind, storm surge, and flooding caused by precipitation.

Wind-related losses, including coverage leakage and storm surge, but excluding losses to the NFIP, are estimated at $21 bn to $34 bn. Insured losses from inland flooding, excluding NFIP claims, are projected to range from $1 bn to $2 bn.

In total, Moody’s RMS expects combined wind-related losses from both storms to be between $28 bn and $46 bn, with inland flooding losses ranging from $2 bn to $4 bn. This results in a combined total insured loss estimate of $30 bn to $50 bn, with a best estimate of $37 bn.

Private Market Insured LossWind (incl. coverage leakage) and storm surge excl. NFIPInland Flood excl. NFIPTotalBest Estimate
Helene$7 bn – $12 bn$1 bn – $2 bn$8 bn – $14 bn$11 bn
Milton$21 bn – $34 bn$1 bn – $2 bn$22 bn – $36 bn$26 bn
Combined$28 bn – $46 bn$2 bn – $4 bn$30 bn – $50 bn$37 bn
Source: Moody’s RMS

Hurricane Helene’s estimated losses remain between $8 bn and $14 bn, with wind damage accounting for $7 bn to $12 bn and inland flooding contributing $1 bn to $2 bn. These figures also exclude losses related to the NFIP.

Moody’s RMS projects that NFIP losses from both events could surpass $5 bn, driven primarily by storm surge, particularly in areas south of Tampa Bay-St. Petersburg. Residential properties will account for most insured wind and NFIP losses, while commercial and automobile sectors will contribute to storm surge and inland flooding losses in the private insurance market.

The estimates for Milton include property damage and business interruption across residential, commercial, industrial, watercraft, and automobile sectors. They also account for post-event loss amplification from the cumulative impact of both storms and unmodeled losses from extended power outages and tornadoes.

Raj Vojjala, Managing Director of Modeling and Analytics at Moody’s, highlighted the importance of considering the overlapping damage areas from both Milton and Helene, especially in regions that had not yet fully recovered from Hurricane Ian in 2022.

Our vulnerability experts on the ground surveyed these impacts firsthand, which was invaluable in discerning the loss potential from Milton

Raj Vojjala, Managing Director of Modeling and Analytics at Moody’s

“Field reconnaissance confirmed numerous instances of improved resilience of structures that had their roofs replaced recently. It also highlighted areas with older building stock and roofs in parts of Tampa Bay that had not experienced such high winds in recent times, which will likely drive notable wind claims in Milton, especially if they are subject to the Florida 25 percent roof replacement rule,” Raj Vojjala says.

Jeff Waters, Director – North Atlantic Hurricane Models, Moody’s, commented: “Alongside damaging wind, storm surge, and precipitation-induced inland flooding, the outer rainbands of Hurricane Milton also produced numerous damaging tornadoes across Florida.

Damage surveys by the National Weather Service are ongoing, but preliminary reports suggest that Milton produced one of the most prolific tornado outbreaks associated with a tropical cyclone in recent history.

Nataly Kramer by Nataly Kramer