Hurricane Helene Could Cost Insurance Industry $14 Billion

Hurricane Helene losses covered by private insurance could reach an estimated $14 billion according to new estimates.

Moody's says that U.S. private market insured losses from the deadly storm that tore across several southern states will be between $8-14 billion, with a best estimate of US$11 billion.

The Moody's RMS estimate represents insured losses associated with wind, storm surge and precipitation-induced flooding, according to Moody's.

The company says losses to the National Flood Insurance Program from Hurricane Helene could reach more than $2 billion across Florida, Georgia, the Carolinas and parts of the Mid-Atlantic.

Moody's expects the private market losses to be driven by wind, with bigger losses in Georgia than in Florida. An unprecedented amount of treefall-related property damage, from high winds and saturated soils, potentially made Helene the worst hurricane loss in Georgia's history.

Storm surge in Florida and floods in North Carolina will also contribute notably to total private market-insured losses

Estimated losses reflect property damage and business interruption to residential, commercial, industrial, and automobile lines of business, and consider sources of post-event loss amplification (PLA) and non-modeled losses from extended power outages, and infrastructure damage to roads, transmission, and distribution lines.

Hurricane Helene made landfall as a Category 4 major hurricane west-southwest of Perry, Taylor County, Florida on September 27. It had 140 mph winds at landfall.

"The worst impacts from this event are from inland flooding, where Helene completely devastated several towns in North Carolina, Tennessee and surrounding states with historical levels of precipitation," Firas Saleh, Director-U.S. Inland Flood Models and Moody's said. "Thousands of buildings were exposed to fast-moving waters over eight feet, and several to depths greater than 15 feet."

Saleh says they expect widespread damage and total constructive losses in these regions, with prolonged recovery due to the catastrophic infrastructure damage.

"Unfortunately, flood insurance penetration is extremely low in the worst-affected region, meaning most of the damage will be uninsured, and economic property losses will far outweigh insured losses," Saleh added. "We expect to see Helene accelerating flood insurance purchases to help close the significant flood protection gap in these regions."

With Hurricane Milton due to hit Florida's west coast on Wednesday, where there is overlap between the two storms may be difficult for claims adjusters to assign them to the event that caused the most damage.