RMS: Hurricane Sally to cause up to $3.5bn insured loss in US

Catastrophe risk modeller RMS has estimated the total insured losses from Hurricane Sally in the US to be between $2.0 billion and $3.5 billion, including losses to the National Flood Insurance Program (NFIP) of between $400 million and $800 million.

The estimate includes wind, storm surge, and inland flood losses across parts of the Gulf and Florida regions, as well as post-event loss amplification (PLA) and non-modeled sources of loss.

Losses reflect property damage and business interruption to residential, commercial, industrial, and automobile lines of business.

RMS expects the majority of insured losses will impact residential lines.

Sally was the eighteenth named storm of the 2020 North Atlantic hurricane season, the seventh hurricane, and the fourth US landfalling hurricane of this very active season.

“Sally made landfall with much stronger winds than expected. While it weakened considerably as it moved inland, the slow-moving nature of the storm brought persistent wind and storm surge to much of the Gulf coastline, combined with heavy rainfall and widespread flooding to interior regions. Sally is another example of how hurricane damage can take many different forms,” said Jeff Waters, senior product manager at RMS North Atlantic Hurricane Models.

Rajkiran Vojjala, vice president, model development, added: “We expect Sally to be a sizable event for the NFIP. The majority of NFIP take-up occurs in coastal counties, especially in the states most impacted by the hurricane, notably Alabama and Florida. However, the inland extent of heavy rainfall from this event means we’ll likely see NFIP losses stemming from inland flood as well.”