Total U.S. private market insured losses from the Hurricanes Helene and Milton will likely range between $35 billion and $55 billion, according to Moody’s RMS Event Response, which said the confluence of the two storms will make paying claims and attributing losses difficult.

The estimate is for insured losses associated with wind, storm surge, and rain-induced flooding. Last week, Moody’s RMS estimated insured losses for Hurricane Helene between $8 billion and $14 billion.

Moody’s expects to issue its final industry-insured loss estimate for Hurricane Milton later this week.

Hurricane Milton was the fifth hurricane to make landfall in the U.S. The storm made landfall near Siesta Key, Florida on October 9 as a Category 3 hurricane with maximum sustained winds of 120 miles per hour. Hurricane Milton followed Hurricane Helene, affecting many of the same areas with damaging wind, storm surge and inland flooding.

Moody’s listed some uncertainties in its preliminary estimate, including:

• Complex hazard patterns: Alongside the damaging wind, storm surge, and rain-induced inland flooding, the outer rain bands of Hurricane Milton also produced damaging tornadoes in southern Florida. The storm also interacted with a mid-latitude jet over the Gulf of Mexico that resulted strong winds –one to the south of the storm associated with the tropical portion of Milton, and one that wrapped around the back of the system associated with its interaction with the jet.
• Coverage leakage across events: Preliminary reports indicate several instances where structures damaged in Helene that may have been uninsured or underinsured for flood, were also affected by high winds and wind-driven rain in Milton. It may be difficult to ascertain the proximate cause of loss in cases, which may lead to coverage leakage.
• Event Attribution: If a claim was opened after Helene and if there is additional damage in Hurricane Milton, it will likely result in a single payout, but there will be questions on which event the payout is assigned to, and the resulting impact on potential reinsurance recoveries.
• Annual hurricane deductibles: Most homeowner policies in Florida have an annual hurricane deductible. If the deductible was exhausted during Helene, it could mean higher losses for any damage covered by the insurer in Milton.
• Damageable exposure: The overlap in high winds across the two storms makes it challenging to assess damage. Structures damaged by Helene are unlikely to have been repaired before Milton and may be prone to additional damage from Hurricane Milton. Much of the coastline affected by storm surge in Milton was also affected by Hurricane Ian in 2022. Thousands of properties that sustained damage from Ian have not yet been rebuilt, which can reduce the potential exposure in Milton.

Moody’s says each factor could influence and prolong the claims settlement process for the two storms. Moody’s RMS Event Response will provide its Industry Loss Estimate for Hurricane Milton by the end of this week, including a comprehensive estimate of all sources of modeled and non-modeled losses.

This article was previously published by Claims Journal