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Storm Harvey : the total loss will reach several tens of billions of dollars

by

Mathieu Carbasse

5 September 2017, 11:30

Photo : Texas Military Department

The total amount of losses due to the passage of the storm Harvey in Texas could be between 25 and 37 billion us dollars (G$), according to the latest analysis from CoreLogic, which reported that about 70% of the damage caused by floods are not insured.

Thus, the insured losses related to the flooding in 70 counties in Texas affected by the storm are estimated to be between 6.5 and 9.5 G$. An additional surplus estimated to be between 1 and$ 2 billion of insured losses is attributed to the damage caused by the wind. In residential, the uninsured losses for the same area are estimated to be between 18 and 27 G$.

 

 

Another analysis from CoreLogic also shows that 52% of residential and commercial properties in the metropolitan area of Houston, located in an area at risk to «high» or «moderate» flooding, but are not in an Area of special flood hazard (SFHA) as identified by thefederal Agency for emergency management (FEMA).

More than 500 000 damaged vehicles

According to Aon Benfield, the global economic costs of Harvey will reach at least tens of billions of us dollars. This includes the direct damage to dwellings, automobiles, infrastructure, agriculture, farms, offshore oil, and land. This also implies a considerable cost resulting from the interruption of the activity in many sectors.

Aon Benfield, which cites reports from several groups of the automotive industry, it also indicates that 500 000 vehicles, at a minimum, have been damaged by Harvey.

Estimates are even more pessimistic

Finally, as highlighted by the latest report from Guy Carpenter, the initial estimates of Moody’s Analytics indicate that the economic losses for the south east Texas could be understood between 51 and 75 billion G$. The study also indicates that the penetration rate of the insurance Program national flood insurance (National Flood Insurance Program, NFIP) in the Houston area are relatively low, and that the losses of the program will be important.

In his study, Guy Carpenter also cites the report of Reuters , which assesses the economic losses for property damage at approximately$23 billion.

For its part, RMS estimates economic losses of between 70 and 90 G$. RMS also considers the insured losses due to the wind only to$ 6 billion. Finally, AIR Worldwide estimates that insured losses due to wind will reach between 1.2 and 2.3 G$.

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