Posted on 14 Sep 2012 by Neilson
Catastrophe modeler Risk Management Solutions Inc. (RMS) reported on Thursday that Hurricane Isaac's wind and storm surge impacts on the Gulf Coast last month resulted in as much as $2 billion in insured losses.
RMS, based in Newark, California, estimated that insured damage would range between $1 billion and $2 billion, excluding rainfall-driven flood losses and all National Flood Insurance Program losses.
“This estimate includes the possibility of a small amount of loss stemming from so-called coverage leakage, i.e., losses caused by surge inadvertently paid out by wind-only policies,” said RMS in a statement announcing the estimate.
“The width of the range reflects some remaining uncertainties, including the variability and uncertainty around loss at very low wind speeds — mostly tropical storm strength — and, in particular, the uncertainty around coverage leakage of surge-related losses into wind-only loss payments,” said Christine Ziehmann, director of model product management at RMS, in the statement.
Hurricane Isaac made landfall in Louisiana on Aug. 28 as a Category 1 hurricane, near the mouth of the Mississippi River, then made a second landfall of the same intensity near Port Fourchon, La., the next day.