KCC pegs privately insured loss from hurricane Helene at close to $6.4bn

According to catastrophe risk modelling specialist, Karen Clark & Company (KCC), privately insured losses from hurricane Helene will near $6.4 billion, driven by wind, storm surge, and inland flooding across nine states.

A Category 4 storm with 140 mph winds, Helene made landfall near the city of Perry in the Big Bend Region of Florida on September 26th. The storm then weakened while moving northward into Georgia, becoming a tropical storm by 5:00 am on September 27th and transitioning to post-tropical by the evening.

The KCC loss estimate is based on the high-resolution KCC US Hurricane Reference Model, and includes privately insured damage to residential, commercial, and industrial properties and automobiles, as well as business interruption.

The up to $6.4 billion insured loss estimate does not include damages to boats, offshore properties, or losses to the National Flood Insurance Program (NFIP), which could be meaningful given the storm’s impact along the coast.

Hurricane Helene is the fifth and second major hurricane of the 2024 Atlantic hurricane season, surpassing Idalia which made landfall with 125-mph winds in 2023. Record three-day rainfall was observed at locations in western North Carolina, with several locations reporting over 20 inches of rain, as noted by KCC.

KCC stated, “In contrast to a typical Category 4 hurricane, most of the damage occurred far from the landfall point, with higher wind damage in Georgia than Florida, more surge damage in Tampa, and the most significant inland flood damage in North Carolina.”

Since Helene made landfall mainly in the sparsely populated areas in the Big Bend, losses are estimated to be higher in Tallahassee overall, while losses from wind damage in Georgia are expected to surpass those in Florida.

Meanwhile, property damage from coastal flooding was concentrated around Tampa Bay, particularly in Clearwater and St. Petersburg. However, inland flooding was deemed the most impactful damage-producing aspect of hurricane Helene from a total property damage perspective, but it contributes a smaller portion to insured losses as most properties are not insured for flood.

So far, CoreLogic has estimated wind and storm surge insured losses of between $3 billion and $5 billion, while Moody’s projects total property damage to range from $15 billion to $26 billion, and Steve Bowen at Gallagher Re warned that private insurance losses will likely fall in the mid-to-high single-digit billions. Meanwhile, RBC Capital Markets estimates insured losses to range from mid-single-digit billions to as high as double-digit billions.

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