Hurricane Michael is expected to cause at least $25 billion in economic losses from now until its dissipation.
Bloomberg reports that about $3 billion of the total will ‘fall on the federal flood insurance program.’ Private insurers are likely to face bills ranging from $9 to $10 billion, according to disaster modeler Chuck Watson.
Whatever damages remain—roughly half, says Watson—aren’t covered by any authority.
The Palm Beach Post said that small insurers and local companies may suffer the most while providing recompense to clients.
“For smaller companies, especially single-state Florida writers whose portfolios are comprised predominately of property-casualty lines of coverage (particularly homeowners), the potential impact from Hurricane Michael losses is more critical,” said insurance rating company A.M. Best Co.
Nevertheless, A.M. Best said it “does not anticipate a large number of rating actions related to Hurricane Michael” but will continue to monitor the market for new developments.
Most of the damage sustained has been in and around the Florida Panhandle, shortly after the storm made landfall Wednesday. The hurricane’s winds were among the strongest recorded in recent history, gusting up to 155 miles per hour.
The storm’s death toll is estimated to be at least 16, with the casualty count expected to rise as emergency workers continue to search rubble.
Several deaths were reported in Virginia, at the northern end of Hurricane Michael’s northerly course.
“Unlike several recent bad storms like Harvey and Florence, Michael is a traditional hurricane event where the most intense damage is in a narrow swath along the coast and along the track of the storm caused by either wind, waves or storm surge,” said Watson, who works with Enki Research in Savannah, Georgia.
Most of the damage, writes Bloomberg, was caused by various forms of inundation. Rainfall lent to widespread flooding—in some areas, storm surge caused sea levels to rise a dozen feet over ordinary conditions.
Hurricane Michael was hovering near the Carolinas’ coast on Thursday and is expected to move back out to sea as Friday and the weekend progress.
Floridians are still recovering from regional power outages. At least 700,000 customers lost power in Florida alone. Local companies claim that rapid progress has been made to address and amend complaints.
“Now that we have restored service to nearly 70,000 FPL customers who were impacted by Hurricane Michael, we are joining several of the nation’s other electric companies to help get the lights back on for our fellow American citizens,” said FPL CEO and president Eric Silagy.
Experts predict that Michael will be absorbed by other weather systems at sea, with some of its remnant energy having the potential to touch the Europe’s western coast.