With extensive damage from the impacts of Hurricane Melissa seen across the Caribbean, insurance and reinsurance broker Aon warns that total economic and insured losses could land in the single-digit billions of USD, and potentially higher after future damage assessments in the countries hit by one of the most intense storms on record in the Atlantic.
Melissa, which peaked with estimated winds of 185mph (298 kph) and a minimum central pressure of 892mb, crossed the exceptionally rare sub-900 mb minimum central pressure threshold – the most recent being Milton (897 mb) just last year.
After making landfall in Jamaica as a Cat 5 storm, the first of this strength to hit the country, Melissa left around 77% of the customer base of Jamaica’s sole electricity distributor (JPS), without power.
Significant wind and rain impacts also extended into Haiti, the Dominican Republic, and Cuba, resulting in extensive property and infrastructure damage.
In Cuba, the most affected area was the East of the country, with Melissa making landfall early on October 29. Around 735,000 people, primarily in Santiago de Cuba, where the city sustained severe damage including flooded homes, collapsed houses, and blocked roads.
Damaged communication infrastructure and disruption are complicating damage assessments, according to the report.
In Haiti, more than 1,000 homes have been flooded and nearly 12,000 people moved into emergency shelters across the nation. Petit-Goave, a coastal town located 64 km (40 miles) west of the capital city Port-au-Prince, suffered extensive damage due to a nearby river bursting its banks.
As of October 30, at least 44 fatalities have been reported across the Caribbean: 29 in Haiti, 8 in Jamaica, 4 in the Dominican Republic, and 3 in Panama. The total number of deaths is expected to rise.
Currently, Melissa is heading to Bermuda, with hurricane conditions expected before the storm begins to rapidly weaken and transition into an extratropical cyclone by November 1.
Hardest-hit areas, especially in western Jamaica, report fully collapsed structures, roofs torn from homes, stripped trees, and widespread debris.
Additionally, communication lines remain down in the most affected communities, complicating efforts to gauge the full extent of the damage.
A portion of losses from Hurricane Melissa in Jamaica, which has very low insurance take-up rates, will be tied to their current catastrophe bond and underlying layers of contingent insurance coverage and reserves, Aon noted.
The country secured their most recent catastrophe bond in 2024, partnering with the World Bank and Aon. Under the bond terms, a 100% payout of $150 million is triggered for a hurricane near or directly over Jamaica with a minimum central pressure at or below 900 mb.
Additional funds may also be triggered via the country’s relationship with the Caribbean Risk Insurance Facility (CCRIF SPC), which utilizes excess rainfall and wind parametric triggers.
The majority of the financial burden is expected to fall on the country’s economy due to low insurance penetration.
In 2025, the Insurance Association of Jamaica (IAJ) reported that only 20% of residential properties were insured, with 95% of those underinsured. An AM Best report places the number of all insured properties even lower, at just 5%.
While the resort infrastructure has seen a significant increase in exposure since Hurricane Gilbert in 1988, fears exist of major wind and flood insured losses in both commercial and residential markets.
Crop insurance also faces threats, with only around 1,100 of 180,000 registered small farmers insured as of 2024.
Nevertheless, the combined catastrophic damage to private and public property and infrastructure is set to generate significant economic losses for Jamaica.
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