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11th September 2019
RMS estimates insured losses to the Caribbean from Hurricane Dorian will be between $3.5 and $6.5bn
RMS has estimated that insured losses to the Caribbean from Hurricane Dorian will be between $3.5 and $6.5bn. This estimate represents insured losses associated with wind and storm surge damage across the Caribbean region, most notably in the Bahamas, which was the most severely impacted country.
RMS estimates that nearly all of the Caribbean insured losses will come from the Bahamas, particularly Grand Bahama and Abaco Islands. This loss estimate reflects property damage and business interruption caused by wind and storm surge-driven coastal flooding to residential, commercial, industrial, marine and automobile lines of business, plus factors for both post-event loss amplification (PLA) and non-modelled losses.
Jeff Waters, senior Product manager, RMS North Atlantic Hurricane Models, comments “There is a high degree of uncertainty on the potential impact of post-event loss amplification from this event. Nevertheless, we expect PLA in the Bahamas to be significant due to constrained access to the islands and infrastructure damage. Port closures, damaged roads, and severe damage to the airport will make it difficult to deliver the necessary labour and materials to impacted areas. It will also limit the ability of residents and business owners to return to damaged homes and buildings. Consequently, cost of materials is expected to inflate, and repairs could be prolonged, both of which are expected to amplify the cost of the claims from this event.”
Business interruption losses are expected to be significant in the Bahamas as a result of the storm, as hotels and resorts comprise a large portion of the overall commercial exposure in the two most heavily impacted islands-Grand Bahama and Abaco.
Peter Dailey,vp, Model Development at RMS, added “Insured losses in the Bahamas are also expected to settle over a longer period than in a typical Caribbean hurricane given an expected spike in demand for claims adjusters, many of whom will be unable to inspect properties or even access the two main affected islands for some time.”
Hurricane Dorian was the fourth named storm of the 2019 North Atlantic hurricane season, and the first major hurricane of the season.
RMS Trends(124 articles)