RMS puts Hurricane Laura insured losses at up to $13bn

The onshore insured losses from Hurricane Laura, the first major storm of the 2020 North Atlantic hurricane season, will range from $9 billion to $13 billion while the offshore losses will be another $1 billion to $2 billion, according to risk modelling firm RMS. The estimate includes...

...wind, storm surge, and inland flood losses across impacted states, including Louisiana and Texas.

It also includes losses to the National Flood Insurance Program (NFIP), which RMS expects to reach $400 million to $600 million.

Losses reflect property damage and business interruption to residential, commercial, industrial, and automobile lines of business, as well as post-event loss amplification and non-modeled sources of loss. Industrial losses include impacts to speciality lines, such as refineries and petrochemical plants, many of which lie along this part of the Gulf coastline.

RMS estimates an additional $1 billion to $2 billion of insured losses to offshore platforms, rigs, and pipelines in the Gulf of Mexico, due to wind and wave-driven damages.

Hurricane Laura was the twelfth named storm of the 2020 North Atlantic hurricane season, the first major hurricane of the season, and the third landfalling hurricane of the season. NOAA expects the Atlantic to remain highly active through the remaining three months of the official 2020 hurricane season.

“Although Laura avoided major metropolitan areas like Houston and New Orleans, it was still an extremely impactful U.S. event," said Jeff Waters, senior product manager, RMS North Atlantic Hurricane Models. "After making landfall as a powerful Category 4 storm, it maintained its intensity as it moved inland, causing widespread wind and water-driven damage well into interior portions of Louisiana. The extent and severity of these damages has been verified by our development teams via web and aerial-based reconnaissance efforts.”

Pete Dailey, vice president, model development, added: “Offshore assets have evolved significantly since the impactful hurricanes of Katrina and Rita in 2005 and Ike in 2008, but there is still a prevalence of platforms, rigs, and pipelines in the Gulf region. Many of these assets, including several high-value deep-water platforms, were exposed to the significant wind and wave impacts from Hurricane Laura. At landfall, Laura produced devastating sustained winds of 150 mph [240 km/h], according to both the National Hurricane Center and RMS HWind forecasting service. Our forecasts provided clients with estimates of Laura’s potential impacts in the critical days leading up to landfall.”