Homes are partially toppled onto the beach after Hurricane Nicole came ashore on November 10, 2022, in Daytona Beach, Florida. (Credit: Joe Raedle/Bloomberg)
Roughly 98% of the ZIP codes in Florida that were hit by Hurricane Nicole were previously impacted by Hurricane Ian, according to Risk Management Solutions, Inc. (RMS).
Jeff Waters, staff product manager, North Atlantic Hurricane Models, explained the overlapping nature of Ian and Nicole will bring a great deal of uncertainty into the loss attribution and claims settlement process. Similar situations occurred after overlapping Hurricanes, such as Ida and Nicholas in 2021, and Laura and Delta in 2020.
"Even though Hurricane Nicole was much less intense than Hurricane Ian a few weeks prior, it exhibited a large wind field that impacted many of the same areas in Florida," Waters said in a release.
Usually, a hurricane of Nicole's force wouldn't result in much post-loss amplification (PLA) if it were to occur on its own, according to RMS' Sarah Hartley, manager, event response. PLA refers to the surge in costs, such as labor and materials, due to demand following natural catastrophes.
"However, the fact that it (Hurricane Nicole) closely follows a major event with Hurricane Ian, means that the same factors influencing PLA from Ian also apply to Nicole, including shortages of labor, materials and claims adjusters," Hartley said in a release. "This is an example of compounding PLA effects."
Private market insured losses from Hurricane Nicole are expected to total less than $2 billion, according to RMS. According to RMS, insured losses in parts of the Bahamas hit by Hurricane Nicole are expected to be minimal.
Private wind and storm surge losses from Hurricane Nicole are anticipated to range from $1.2 billion-$1.8 billion. Most wind and storm surge losses are anticipated to come from Florida, while Georgia and Florida will see the bulk of flood claims. The National Flood Insurance Program (NFIP) is expected to see less than $300 million in losses from Nicole, RMS reported.
The Federal Emergency Management Association (FEMA) Hurricane Ian has already led to 44,000 claims and the NFIP has paid out nearly $437 million to policyholders hit by the September hurricane.
Hurricane Ian could result in as much as $5.3 billion in NFIP claims, FEMA reported.
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