Hurricane Wilma may have caused up to $10 billion in insured losses as it cut across Florida on Monday, according to early estimates from risk assessment firms.
Risk Management Solutions estimated that insurance companies will have to pay claims in a range of $6 billion to $10 billion for damage caused by Wilma in Florida.
RMS, which is based in Newark, Calif., said its projection covered onshore damage resulting from wind and a coastal storm surge, business interruption and increased costs for materials and services needed for repairs.
Earlier, AIR Worldwide Corp., a risk-modeling firm based in Boston, estimated that insurance companies will have to pay claims ranging from $6 billion to $9 billion for damage caused by Wilma.
It noted that Wilma, rated a Category 3 hurricane, was “significantly less intense” than Hurricane Katrina, the Category 4 storm that caused some $34.4 billion in insured losses when it hit the Gulf Coast Aug. 29.
AIR Worldwide said it expected Wilma to produce the greatest insurance claims in “the concentration of properties on Florida’s east coast, between West Palm Beach and Miami.” Wilma plowed into southwest Florida early Monday and dashed across the state to the Miami-Fort Lauderdale area.
Another risk assessment firm, Eqecat Inc. of Oakland, Calif., estimated insured losses from Wilma at $4 billion to $8 billion. Its preliminary estimated had been a range of $2 billion to $6 billion.
Eqecat said it raised its projections after incorporating wind readings of up to 100 mph in Miami and more than 105 mph in nearby Broward county.
“Beyond wind damage to commercial and residential fixed structures, such as office buildings, factories, warehouses and homes, Eqecat’s insured loss estimates include business interruption, which covers loss of earnings as a result of the destruction of property,” the company said. It also covers increased repair costs.
Eqecat also said its preliminary estimated of insured losses on the Mexican Yucatan Peninsula, which was hit over the weekend, totaled $1 billion to $3 billion. The area of Mexico that was hit includes extensive hotel and resort development.
