Hurricane Beryl losses to be very manageable for the re/insurance industry: Bowen, Gallagher Re

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Despite the possibility of hurricane Beryl being a billion-dollar economic loss for the United States, it is expected to be a very manageable storm for the re/insurance industry, Steve Bowen, Chief Science Officer at Gallagher Re has commented.

hurricane-berylBowen has shared some thoughts on the potential loss impacts from Beryl in the US, noting that damage assessments and claims filings are just starting, therefore this guidance is subject to change.

According to Bowen, wind-related insured losses for the private insurance market could at least run into the hundreds of millions (USD), based on the landfall location and the inland track.

Yet it is still too early to provide a specific economic or insured loss estimate.

“The higher-than-expected wind gusts entering the heavily and densely populated Houston metro region, however, does raise the potential that wind-related losses for the industry could be more notable than originally anticipated had Beryl weakened more quickly while tracking inland. Texas does not have a well regulated, enforced, or detailed set of stringent building codes that leaves the state vulnerable to wind-related damage,” he explained.

Additionally, torrential rains caused by Beryl led to widespread reports of significant riverine overflow and flash flood damage. This combined with coastal storm surge losses, could translate to NFIP claims payouts that may lead to additional insured losses into the hundreds of millions (USD), Bowen also noted.

Business interruption losses are expected to be costly but remain uncertain as they are heavily dependent on how long power outages last.

Another factor to consider will be whether major large commercial facilities face widespread physical damage or prolonged shutdown of operations as the recovery process begins.

“The current expectation is that Beryl will be a billion-dollar economic loss for the United States, but it is entirely within reason that this eventually settle as a multi-billion-dollar cost in the country,” Bowen predicts.

Adding: “The Caribbean impact will be notable but not as financially expensive as what was incurred in the US. The current expectation is that economic losses will be well into the hundreds of millions (USD) across Jamaica and the Windward Islands. It has already been announced by Jamaica’s Ministry of Finance that Beryl has triggered an insurance payout of USD16.3 million from the Caribbean Catastrophe Risk Facility (CCRIF SPC).

“The bottom line is that Beryl will be a very manageable storm for the re/insurance industry.”

The Atlantic is expected to remain quiet for a few weeks, like the month break between major hurricane formations from Emily in July until Katrina in August. But Bowen warns not to get complacent.

The post Hurricane Beryl losses to be very manageable for the re/insurance industry: Bowen, Gallagher Re appeared first on ReinsuranceNe.ws.

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