RMS Estimates Wilma Insured Losses Will Total $6 Billion-$10 Billion

Insured losses in the United States from Hurricane Wilma are likely to range from $6 billion to $10 billion, predicted Risk Management Solutions (RMS). The Newark, Calif.-based company said its estimate is based on current information on landfall location and wind speeds, and is comprised of onshore damage resulting from wind and coastal storm surge, business interruption, and increased costs for materials and services needed for repairs (demand surge).

Hurricane Wilma made landfall at 6:30 am EDT on the southwest Florida coast near Cape Romano (20 miles west of Everglades City) as a category 3 hurricane with maximum sustained winds of 120 mph and a central pressure of 950 mb. At landfall, the storm was larger and more intense than forecast, with an eye diameter of more than 70 miles, and hurricane force winds extending out 90 miles.

Wilma traversed Florida, maintaining hurricane strength before exiting back over the Atlantic Ocean. The storm’s large diameter and fast forward speed brought peak gusts of more than 100 miles per hour to the Miami metropolitan region, which had escaped relatively unaffected by the string of hurricanes to affect Florida and the Gulf coast since August 2004. Due to the high density of property in Miami, even a low level of damage across the area could drive up insured losses.

Hurricane Wilma’s track across Florida followed its devastating weekend landfall on Mexico’s Yucatan coast, where severe damage to beachfront properties and hotels has been reported. That region has not been hit by a major hurricane since Hurricane Gilbert struck the area in 1988 as a category 5 storm. In the years since Gilbert, the Yucatan Peninsula has seen a tremendous tourism development boom, which will result in considerable property damage from Wilma’s impact.

Following the success of earlier aerial reconnaissance missions across hard to reach areas after hurricanes Katrina and Rita, RMS and its partner ImageCAT will be conducting aerial surveys of the damage areas on Monday and Tuesday. RMS will continue to monitor Wilma’s impact throughout the week.

RMS provides products and services for catastrophe risk management. For more information, visit www.rms.com.