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Hurricane Idalia Causes up to $5 Billion in Insured losses

Hurricane Idalia, which struck the Big Bend region of Florida last week, caused between $3 billion and $5 billion in insured losses, according to a report by the catastrophe risk modeling business of Moody’s. The report, which was released on Monday, estimated the losses associated with wind, storm surge, and precipitation-induced flooding caused by the hurricane. The report also said it expects around $500 million in losses to the National Flood Insurance Program (NFIP) due to the hurricane.

Hurricane Idalia was the ninth named storm and the fourth hurricane of the 2023 Atlantic hurricane season. It formed in the eastern Caribbean Sea on August 25 and rapidly intensified into a Category 4 hurricane on August 28. It made landfall near Apalachicola, Florida, on August 29 with maximum sustained winds of 130 mph. It then weakened as it moved inland over Georgia and Alabama, before dissipating on August 31.

Hurricane Idalia caused widespread damage and power outages in Florida, especially in the Big Bend area, where it brought strong winds, heavy rain, and storm surge. The hurricane also spawned several tornadoes in Florida and Georgia, which damaged homes and businesses. The hurricane also triggered flash floods in parts of Florida, Georgia, and Alabama, where it dumped up to 15 inches of rain. The hurricane claimed at least 12 lives and injured dozens more.

The report by Moody’s said that Hurricane Idalia was one of the most damaging hurricanes to hit Florida since Hurricane Michael in 2018, which caused $16 billion in insured losses. The report said that Hurricane Idalia’s losses were lower than Hurricane Michael’s because it affected a less populated and less developed area of Florida. The report also said that Hurricane Idalia’s losses were lower than initially feared because it weakened before making landfall and moved quickly over land, reducing its exposure time.

The report said that most of the insured losses from Hurricane Idalia were covered by private insurers, while some were covered by the NFIP, which provides flood insurance to homeowners and businesses in high-risk areas. The report said that the NFIP’s losses from Hurricane Idalia were relatively low compared to previous hurricanes because most of the flood damage occurred outside of the NFIP’s designated flood zones. The report also said that the NFIP’s losses from Hurricane Idalia were within its annual budget and did not require additional borrowing from the Treasury.

The report concluded that Hurricane Idalia highlighted the need for more accurate flood risk assessment and mapping, as well as more resilient infrastructure and building codes, to reduce the impact of future hurricanes.