Hurricane Ian is likely to be a significant loss event for the US property/casualty and global reinsurance sectors and is expected to accelerate property pricing in 2023, Standard & Poor’s Global Ratings said in a statement on Friday.
However, insurers are well positioned to absorb losses, and losses for global reinsurers should stay within annual catastrophe budgets, S&P said.
Insured losses in Florida alone are expected to be in the upper end of the $30 billion to $40 billion range, due to Hurricane Ian’s size and intensity, including storm surge, and because it made landfall in a more populated area, S&P said.
Wind damage, storm surges and water damage from heavy rainfall will cause large losses for commercial property and residential insurers and, to a lesser extent, auto insurers, S&P said. Flooding will increase damage primarily to commercial properties.
Hurricane Ian made landfall in the Fort Myers metro area in southwest Florida on Wednesday as a Category 4 storm with wind speeds of up to 155 mph, nearly a Category 5 storm. The hurricane made landfall again in South Carolina on Friday.
Citizens Property Insurance Corp., Florida’s state-backed homeowners insurer, expects losses of about $3.8 billion, for an industry-wide loss of about $30 billion, the rating agency said.
“We expect ratings to be broadly unaffected by the hurricane,” S&P said.