(Reuters) – Insurance companies are dealing $ 15 to $ 30 billion in damage from Hurricane Ida, but the figure could jump higher, in part due to pandemic prices that have pushed up the cost of timber and labor to rebuild, insurance experts said Monday. .
The comprehensive estimates, based on models tracking the severity and path of the storm, are likely to still be less than $ 87 billion in claims from Hurricane Katrina, when adjusted for inflation, experts said.
Insurance companies with significant exposure include Allstate Corp., Progressive Corp., FedNat, Chubb Ltd., American International Group Inc., Travelers Cos. Inc. and The Hartford, according to Piper Sandler analyst Paul Newsome.
Ida was about a category weaker than Katrina was when it landed 1
"Wind damage may be more visible, but you do not know the extent of the water damage until you can actually inspect," says Anne Wilson, real estate expert for America at Swiss Re AG. "You have to get your eyes on the ground."
Homeowners flood insurance costs will be largely covered by the US National Flood Insurance Program, administered by the Federal Emergency Management Agency.  However, commercial policy will face demands for direct physical damage and also business disruptions and supply chain disruptions that spread outside the disaster area, says Robert O & # 39; Brien, CEO of Marsh & McLennan Cos. Inc.
With power outages, floods, harmless roads and other obstacles, production can be interrupted for several weeks and can generate conditional claims from remote companies that cannot receive supplies from or sell products to companies. nies affected by the storm.
"The parties involved can be anywhere," said O & # 39; Brien. "A local event can spread all over the world."
Ida is also likely to renew efforts to address problems with the NFIP, which was launched more than 50 years ago and has $ 20.5 billion in debt because premiums are too low to cover claims costs, Craig said. Poulton, CEO of Poulton Associates, which administers floods and other insurance.
"This incident will serve as a reminder of how severe storms can be," he said.