Tropical Storm Francine, hitting Louisiana, may cause over $1 bn in private insured losses, according to Gallagher Re. The broker firm highlighted that a hurricane’s path significantly impacts physical damage and overall loss estimates.
Gallagher Re’s loss estimate considers the storm’s current path, expected rainfall, storm surge, and Category 1 winds. Francine is still developing.
This $1 bn projection aligns with losses from recent storms in Louisiana. Gallagher Re added that the figure remains manageable for both the insurance and reinsurance sectors.
However, losses could increase to the low bn range if the storm shifts eastward toward the New Orleans metro area. Global Natural Disaster Losses in H1 2024 reached $120 bn, down from 2023, which saw $140 bn in losses due to a severe earthquake in Turkey and Syria.
The National Hurricane Center has issued a hurricane warning for the Louisiana coast, from Sabine Pass near the Texas border to Grand Isle, south of New Orleans.
Francine is expected to make landfall with 90 mph winds. If it intensifies to Category 2, similar storms have caused insured losses in the low-to-mid bn range.
The uncertain storm path remains the key factor in loss estimates. Gallagher Re noted that current projections suggest landfall in a less populated area of Louisiana.
On Sept. 10, a slight eastward shift could bring hurricane-force winds to Baton Rouge and strong tropical storm winds to New Orleans and Lake Charles.
Francine would be the third hurricane to hit the US this year and the first to strike Louisiana. Earlier storms Beryl hit Texas, and Debby impacted Florida last month.
Researchers from Colorado State University, in a September update, reported a faster-than-usual start to the Atlantic hurricane season, with an above-average season forecast through mid-August.
Tropical Storm Francine is a developing storm in the Atlantic, projected to intensify into a hurricane before making landfall in Louisiana.
As of the latest forecasts, it is expected to bring strong winds, heavy rainfall, and storm surges, particularly along the Louisiana coast. Winds could reach up to 90 mph, potentially making Francine a Category 1 hurricane. If it strengthens further to Category 2, insured losses could rise significantly, especially if it shifts toward more populated areas like New Orleans.
A hurricane warning is currently in effect for the Louisiana coastline from Sabine Pass to Grand Isle. While the storm’s path remains uncertain, its potential impact is closely monitored due to the risk of widespread damage. Francine is expected to be the third hurricane to hit the US in 2024, following Beryl in Texas and Debby in Florida earlier in the season.
by Yana Keller
