Florida double-hurricane hit to amplify losses from Nicole

Insured losses from Hurricane Nicole, which made landfall in Florida earlier this month, could reach nearly $US2 billion ($3 billion) as impacts are exacerbated by devastation caused recently by the more powerful Hurricane Ian, risk modelling firm RMS says.

The category one Hurricane Nicole, which crossed the coastline on November 10, brought high winds and heavy rainfall to many areas hit by Ian, worsening impacts from shortages of labour, materials and claims adjusters, in an effect described as post-event loss amplification (PLA).

“Historically, an event of Hurricane Nicole’s magnitude would not exhibit notable PLA impacts if it were to occur on its own. However, the fact that it closely follows a major event with Hurricane Ian, means that the same factors influencing PLA from Ian also apply to Nicole,” Event Response Manager Sarah Hartley said.

Privately insured losses from wind, storm surge and rain-induced flooding are expected to reach $US1.3-$1.9 billion ($1.9-2.8 billion), with a best estimate of $US1.6 billion ($2.4 billion), while losses covered by the National Flood Insurance Program are estimated at up to $US300 million ($449 million).

Although Nicole was much less intense than Ian, it had a large wind field and RMS event response teams estimate that roughly 98% of postal codes in Florida affected by the event were previously impacted by Ian, Staff Product Manager, North Atlantic Hurricane Models Jeff Waters said.

“We expect the overlapping nature of Hurricane Ian and Nicole to introduce significant uncertainties in the loss attribution and claims settlement process,” he said.

Hurricane Nicole was the fourteenth-named storm of the North Atlantic hurricane season, the eighth hurricane, and the second to make US landfall.