Insurers are bracing for a hit of about US$1-billion from physical damage to offshore oil rigs and structures from Hurricane Ida, according to preliminary estimates from U.S. property data and analytics company CoreLogic.
The estimate did not include losses from production disruption and could be revised over time, a spokesperson for CoreLogic said.
The volume of oil shut in by the hurricane in the Gulf of Mexico rose to 1.7 million barrels per day of offshore output by midweek, up 240,000 barrels from when Ida struck, the Bureau of Safety and Environmental Enforcement said.
“Ida has had a significant impact on Louisiana refinery operations and the Gulf of Mexico production, causing a historic U.S. crude supply chain disruption,” according to natural resources consultancy Wood Mackenzie.
“Utility disruptions caused by lack of power, mobile data services, and water, could lead to Ida becoming a long-tailed event when it comes to claims reporting, payouts,” the consultancy said.
Catastrophe modelling company Karen Clark & Co. on Wednesday estimated about US$18-billion of losses in the United States and the Caribbean, while CoreLogic expected insured flood loss for properties in Louisiana, Mississippi and Alabama of between US$6-billion and US$9-billion, with additional wind losses of US$8-billion to $12-billion.
Industry sources have said that total losses could be close to US$30-billion after flash flooding killed at least 44 people in four northeastern states.
“The remnants of Hurricane Ida passing through the Northeast has caused significant water damage … We expect the bulk of those claims to come in over the next several days as businesses access and assess the impact,” William Liebler, U.S. chief claims officer at broker Marsh, said.
Catastrophe modelling firm AIR Worldwide on Friday estimated insured losses, including wind and storm surge, in the range of US$17-billion to US$25-billion from the storm.
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