PCS ups its Ida loss estimate by $1.5bn to $27.4bn
PCS has revised upward its industry loss estimate for Hurricane Ida to roughly $27.4bn, according to a recently released update, this publication has learned.
The updated loss total is about a $1.5bn increase from the group’s previous $25.9bn sum of industry losses. The biggest driver of the increase came from Louisiana, where the loss total increased by more than $1bn to $20.27bn, up from the $19.2bn reported in PCS’s last update.
That would put the losses from Ida alone at roughly double the losses Louisiana suffered for the entire hurricane season in 2020.
In an update earlier this month, the Louisiana Department of Insurance revised total losses in 2020 from hurricanes Laura, Delta, and Zeta up by $600mn to $10.6bn from its August estimate.
In an interview with Inside P&C last week, Louisiana Insurance Commissioner Jim Donelon said industry losses from Ida could reach $30bn, which would position it as the biggest storm to hit the state, surpassing Hurricane Katrina in 2005.
In PCS’s most recent update, claims totals for New York also increased by around $0.5bn to $2.72bn in total.
The figures from the organization exclude losses to the National Flood Insurance Program, which is expected to have taken significant losses following the devastating flooding from the event in the Northeast.
Views on the ultimate scope of the industry loss total have been mixed, with some executives saying that claims have been slow to come in, while some loss development patterns have pointed to a total industry loss below the $30bn+ loss event that many companies have built their ultimate loss estimates around.
However, other executives have suggested that regardless of the ultimate industry loss total, the sheer severity of the event and its unmodeled loss components have grabbed the industry’s attention and led many carriers to reassess their views of cat risk.
Speaking with this publication at the Wholesale & Specialty Insurance Association’s annual convention in San Diego last week, CRC CEO Dave Obenauer said the event had already impacted market conditions.
“So, whether Uri is up or down 10% or Ida is up or down 10%, I don't think is really the issue,” he commented. “It's the big picture unmodeled piece.”
A spokesperson for PCS declined to comment.