Claims News Service, Nov. 1, 11:50 a.m. EST -- U.S. property/casualty insurers will pay an estimated $4.7 billion for insured property losses to residential and commercial policyholders affected by Hurricane Rita, according to preliminary analysis by ISO's Property Claim Services (PCS) unit.
Rita hit homes and businesses hard in seven states, though not as severely as initially feared. Louisiana sustained the highest losses -- $2.4 billion, which accounts for nearly half the catastrophe's total price tag. Texas came second with $2.2 billion in losses.
Insurers expect more than 400,000 claims from policyholders in the affected states for damage to personal and commercial property, automobiles, and boats and yachts.
"Demand surge" will be a factor affecting insurers' ultimate payments to policyholders along the entire Gulf Coast region. The recovery process is likely to be prolonged because construction personnel themselves from the region were displaced or forced to evacuate. Higher material and labor costs are also expected to exacerbate the rebuilding process, as is the prospect that many property owners might choose not to return to or restore their properties.
PCS estimates represent anticipated insured loss on an industrywide basis arising from catastrophes, reflecting the total insurance payment for personal and commercial property lines of insurance covering fixed property, personal property, vehicles, boats, related property items, business interruption and additional living expenses. The estimates exclude loss adjustment expenses.
More information is available at www.iso.com.
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