Hurricane Beryl insured wind losses in Texas estimated $2.5bn to $3.5bn: CoreLogic

CoreLogic, the risk modelling and catastrophe data company, has updated its estimate for industry insured losses caused by recent hurricane Beryl, now putting the total for Texas wind losses at between $2.5 billion and $3.5 billion.

CoreLogic has also updated its estimates for insurable losses in the Caribbean, now saying that between $1 billion and $1.5 billion are expected for the Windward Islands, with less than $1 billion for Jamaica, the Cayman Islands, and Mexico.

CoreLogic said that its Hazard HQ Command Central team has now recreated the Hurricane Beryl wind footprint using available wind observation data, resulting in updated loss estimates that have been derived using a custom footprint.

Its figure for estimated industry insured losses from hurricane Beryl include damages to residential, commercial, industrial, and agricultural properties, including damages to contents and business interruption and also includes demand surge, CoreLogic explained.

For the updated insurance industry loss estimate, CoreLogic has assumed a typical residential insurance policy deductible of 2%, saying that typically homeowners in Texas have options for deductibles ranging from 1% to 5%.

“Uncertainty in the chosen deductible of the individual policyholder can strongly influence the insured loss estimate. In this instance, a shift towards the purchase of a higher deductible amount could significantly reduce the losses paid by insurers,” the company said.

CoreLogic provided some additional insight into hurricane Beryl, noting that its impacts in Texas may have been more significant than originally estimated.

“Hurricane Beryl is a unique storm. In addition to setting several meteorological records during its lifetime, Hurricane Beryl defied expectations after landfall in Texas,” CoreLogic said.

“Hurricane Beryl was a Category 1 hurricane with maximum sustained winds of 80 mph when it made landfall in Texas over Matagorda County, approximately 90 miles from Houston. The system then turned north then northeast towards Houston. However, even after several hours over land, weather stations in Houston recorded 90 mph wind gusts from Hurricane Beryl.

“This sort of phenomenon is typical of stronger hurricanes (e.g., Category 2 or greater) but less so for a system like Beryl. Winds in excess of 90 mph are capable of damage to modern construction.”

Previously, CoreLogic had estimated that total insured wind and storm surge losses in Texas would be between $700 million and $1.5 billion, but had noted this would be updated when more data was available.

The exact landfall location and also how Beryl’s wind swathe affected areas with higher exposure concentration, such as Houston, were seen as critical for defining the insured losses from the event.

Recall that, as we reported yesterday, hurricane Beryl is estimated to have caused insurance industry losses of $2.7 billion in the United States, close to $510 million in the Caribbean, and $90 million in Mexico, according to catastrophe risk modelling specialists at Karen Clark & Co (KCC).