Hurricane Ida may cost insurance companies nearly $18 billion business and economic news

Ada hit Louisiana with the strongest ever wind on the U.S. Gulf Coast, destroying houses, schools, and hospitals.

According to a person familiar with the matter, Hurricane Ida swept through Louisiana with the strongest wind in history, causing power outages for millions of homes and businesses, causing an estimated loss of nearly US$18 billion, and insurance companies will bear it. Liability. Risk modeling company.

Karen Clark & ​​Co. estimated that most of the insured losses occurred in the United States, and the insured losses in the Caribbean were only US$40 million. The estimate includes damage to vehicles, houses, and commercial and industrial properties caused by private insurance, but does not include damage to ships, marine properties, or the national flood insurance plan.

According to Karen Clark, Ida struck Louisiana with a maximum sustained wind speed of 150 miles per hour (240 kilometers per hour) when it landed near Port Fulchion, Louisiana. These winds knocked down trees and electrical wires, and damaged schools, hospitals and other buildings, including the collapse of complete roofs and walls in some cases. Analysts said earlier that they expected insured losses to be between US$15 billion and US$20 billion.

Clean-up efforts may become more expensive, and insurance rating company AM Best warned that the surge in demand could increase losses “meaningfully”. Although costs usually rise after a hurricane, as the consumer price index rises, insurance companies will also face generally higher costs.

The real estate market is still booming. Rising housing prices indicate that there may be a high demand for materials needed to help repair houses. The company is still struggling to cope with the Covid-19 agreement, all of which may affect the cost of repairing damaged buildings. According to AM Sridhar Manyem, head of industry research and analysis at Best, said that Ida is like this.

“Considering the flooding and all other effects and the cost of transportation and transportation of materials, this may increase the cost,” Manyem said in an interview.