- Hurricane Idalia has caused an estimated $178.7 million in insured losses with 19,324 claims reported.
- Residential property claims are the most frequent, with 13,289 reported claims, and homeowners’ claims stand at 9,007. Closure rates vary by category, with homeowners having a closure rate of 32.8 percent, while private flood claims have a lower rate of 3.9 percent.
- Preliminary cost estimates in the wake of Idalia’s pathway through Florida’s Big Bend and Gulf Coast regions approaches $10 billion, according to a report issued by UBS Bank.
Total estimated insured losses following Hurricane Idalia’s landfall last month have amounted to $178.7 million as of Thursday afternoon, with varying percentages of claims closed across different lines of business.
In total, there have been 19,324 claims reported. Among them, 30.1 percent have been closed, with 1,645 claims having open payments and 11,861 open claims without payment. Residential property claims are most frequent, with 13,289 reported claims, while homeowners’ claims stand at 9,007. Closure rates vary by category, with homeowners having a closure rate of 32.8 percent, while private flood claims have a lower rate of 3.9 percent.
This week, Citizens Property Insurance Corp. reported approximately 2,000 claims following Hurricane Idalia, which is below the threshold for imposing surcharges on policyholders.
However, according to a report published by Moody’s Analytics, the private sector could see insured losses ranging between $3 billion and $5 billion, while the federal National Flood Insurance Program could take a $500 million hit. more broadly speaking, preliminary cost estimates in the wake of Idalia’s pathway through Florida’s Big Bend and Gulf Coast regions approached $10 billion, according to a report issued by UBS Bank.
If the estimate holds true, it would exclude Idalia from becoming one of the top ten most expensive hurricanes to hit the United States. For comparison, Hurricane Ian, which made landfall over Southwest Florida last year, accrued nearly $113 billion in total damages as of January.
Recovery expenses are likely to place pressure on Florida’s already feeble property insurance market, which was spread thinner amidst the departure of Farmers Insurance last month.
In light of the industry’s ongoing challenges, insurers are pushing for more swift changes on top of the sweeping legislation passed earlier this year. Florida’s previous property insurance regulatory framework was originally crafted to safeguard customers, but industry analysts say the pendulum swung too far and that framework let consumers down by cratering the market. They also say more reforms are needed to set appropriate premium rates to thwart the ongoing crisis.
Recent legislation has attempted to address some of these challenges. Last December, lawmakers passed Senate Bill 2-A, aimed at reducing excessive litigation that has been driving up insurance costs. The bill also adjusted the eligibility requirements for Citizens Property Insurance Corp. that serves as a fallback option but is one of the state’s most expensive options. Citizens has been accumulating policies at a significant rate, moving from 499,056 policies in August 2020 to nearly 1.38 million policies.
Insurance Commissioner Michael Yaworsky recently approved proposals allowing seven private insurers to assume as many as 202,000 policies from Citizens, part of a longstanding effort to move policies into the private sector. This could be a double-edged sword for consumers, who may end up paying more for coverage, especially given a change in December legislation that mandates Citizens’ customers to accept offers from private insurers if the cost is within 20 percent of Citizens’ premiums.