Hurricane Dennis, which abated somewhat as it made landfall inFlorida may have done its worst damage offshore as it rampagedthrough oil well platforms, according to a knowledgeable insurancebroker.

Bruce Jefferis, a managing director of Aon Natural Resources inHouston, said there is concern that Dennis, which was clocked at acategory four hurricane with winds approaching 140 mph, could havedone significant damage to the Gulf Coast energyinfrastructure.

The huge Thunder Horse platform was reportedly listing 30degrees and could be in some trouble, he said. Mr. Jefferis addedthat it is too early to tell how badly damaged it is or what wouldbe done to repair the platform.

"What will happen to it, we don't know; they will probably rightit, but [if they can't] it could make for a big loss to themarket," Mr. Jefferis observed.

Last season's hurricane Ivan, which was the costliest hurricanein history, resulted in $2.5 billion in total insured losses forenergy insurers, he said. Like Ivan, there may appear to be littledamage to oil platforms and riggings, but pipeline damage fromundersea shifts in terrain could be another story.

"Dennis took a similar path to Ivan, but a little further East,which is good," said Mr. Jefferis, noting that the further West astorm comes the closer it is to the bulk of the oil fields.

"It will be a few more days before we know the initial impact ofDennis on the properties, and maybe a few months before we reallyknow the extent of the damage," Mr. Jefferis explained.

The major problem in determining the extent of damage is thatmuch of the damage could be undersea. Inspection requires divingequipment, which is in limited supply.

One lesson for insurers coming out of Ivan is that the extent ofconnectivity between oil rigs and platforms through underseapipelines was missed by both clients and underwriters.

"It was not understood as well and appreciated," he said. SinceIvan, there is now greater focus and understanding on the rippleeffect from a damaged pipeline, both in terms of avoiding businessinterruptions and in forecasting the loss scenarios.

While capacity remains in the market since Ivan, energyproduction risks have not seen a softening in pricing, Mr. Jefferisnoted. Good risks have seen a 20 percent increase in premiums, andclients with large losses have seen "significant" increases.

"Last year was an adjustment in pricing," noted Mr. Jefferis."But Dennis could cause a whole other cycle."