Hurricanes Harvey and Irma highlight global protection gap
Source: Asia Insurance Review | Oct 2017
A significant proportion of the unprecedented flood losses generated by Hurricane Harvey in Texas and Louisiana will be uninsured, again highlighting the existence of a global protection gap. This was stated by Aon Benfield in the September 2017 edition of its Reinsurance Market Outlook report. As a result, those affected will require substantial financial support from the United States
Catastrophe modelling firm AIR Worldwide estimates property losses from the flooding in Texas caused by Hurricane Harvey’s record-breaking rainfall will be between US$65-75 billion. These figures include damage to all properties eligible for coverage regardless of whether they are actually insured and without any application of deductibles or limits. Note that these estimates do not include losses from Harvey’s winds or storm surge.
AIR Worldwide estimated that industry insured losses from wind, flood, and storm surge combined are expected to exceed $10 billion with approximately $3 billion of the losses resulting from winds and storm surge. Note that these estimates do not include losses to the National Flood Insurance Program (NFIP).
For Hurricane Irma, AIR Worldwide estimated combined industry insured losses for the United States and the Caribbean will range from $32 billion and $50 billion. It estimated industry insured losses for the United States resulting from Hurricane Irma will range from $25 billion to $35 billion while for the Caribbean, it estimated that the industry insured losses will range from $7 billion to $15 billion. A