S&P Comments on Wilma’s Potential Impact on Florida Coverage

A statement, issued by Standard & Poor’s Ratings Services, notes that Florida has already sustained about $1 billion in insured losses during the current hurricane season. Hurricane Wilma is expected to hit Miami-Dade, Palm Beach, and Broward counties today (see related article), which, S&P notes, is the primary area of exposure for the Florida Hurricane Catastrophe Fund and the path taken last year by Hurricane Charley.

“Prior hurricanes in South Florida have shown that a Category 3 storm, which is what Wilma is expected to be when it hits land, could cause substantial insured personal, business, and reinsurance losses,” stated Thomas Upton, a managing director of S&P’s Insurance Ratings Group.

The rating agency’s commentary addresses “whether, in the wake of Katrina and Rita, insurers and reinsurers doing business in Florida–as well as the CAT Fund–will be able to withstand the cost of damage that could result from yet another powerful hurricane. Many primary and reinsurance companies that do business in Florida also do business in Louisiana, Texas, and Mississippi–the states that sustained the most insured losses from Katrina and Rita.”

The report is available to subscribers of RatingsDirect, Standard & Poor’s Web-based credit research and analysis system, at www.ratingsdirect.com. If you are not a RatingsDirect subscriber, you may purchase a copy of the report by calling (1) 212-438-9823 or sending an e-mail to research_request@standardandpoors.com. Ratings information can also be found on Standard & Poor’s public Web site at www.standardandpoors.com; under Credit Ratings in the left navigation bar, select Find a Rating, then Credit Ratings Search. All Standard & Poor’s research information is accessible for 24 hours after publication on the public Web site.