The Strategist

Analysts: Hurricane Dorian will cost insurers $ 25 bln

09/03/2019 - 08:05

Analysts at UBS Group believe that Hurricane Dorian will cost insurance companies at least $ 25 billion. If it reaches the coast of Florida in the next few days, the loss will amount to $ 40 billion.

Hurricane Dorian that hit the Bahamas will cost insurance companies at least $ 25 billion, writes Bloomberg, citing analysts at the Swiss financial holding UBS Group AG. At the same time, if Dorian reaches the east coast of Florida in the next few days, it could cause damage in the amount of $ 40 billion, experts said.

Hurricane Dorian has already become the most powerful hurricane of those that hit the shores of the Atlantic Ocean since the so-called "Labor Day Hurricane" in 1935, writes Bloomberg with reference to the American National Weather Center.

If the forecast of analysts comes true, Dorian will become the most expensive natural disaster for the insurance industry since 2017. The past hurricane that caused the insured property more than $ 25 billion in damage was Mary, Munich Re database indicates. After that, the insurance industry was faced with a relatively small number of natural disasters, which allowed the largest global insurers to accumulate excess capital in the amount of $ 30 billion, reports UBS. Possible losses due to Dorian will hit these savings and force companies to change prices, analysts say.

According to the latest data from the US National Hurricane Observation Center, Hurricane Dorian formed in the Atlantic and has intensified to the maximum fifth category on the Saffir–Simpson Hurricane Scale. It has already caused significant damage in the northern part of the Bahamas and claimed lives of two people. In connection with the approach of the hurricane, the evacuation of the population was announced by the authorities of three American states - Georgia, South Carolina, and Florida.