Hurricane Wilma Losses on Florida’s West Coast Estimated at $6B to $9B

Catastrophe risk modeling company AIR Worldwide Corporation estimates U.S. insured losses from Hurricane Wilma at $6 billion to $9 billion. Wilma strengthened overnight and made landfall at 6:30 a.m. this morning at Cape Romano, Florida, as a Category 3 hurricane with maximum sustained winds of 125 mph.

As a Category 3 storm, Wilma was significantly less intense than August’s Hurricane Katrina, a strong Category 4 hurricane. In addition to Wilma’s lower wind speeds and fast forward speed of near 23 mph, the lower vulnerability of structures in Florida will lead to insured losses well below those of Katrina.

“The building code in south Florida is the most stringent in the U.S. and far more rigorous than in the parts of the Gulf Coast affected by Hurricanes Katrina and Rita,” Dr. Jayanta Guin, AIR vice president of research and modeling said. “Our detailed analysis of claims data from the 2004 season showed that Florida’s stronger codes led to less damage than would normally be expected had the storms hit a more vulnerable area of the coast, as reflected in our model.”

Near the landfall location, Hurricane Wilma’s wind speeds were strong enough to cause structural damage to light metal buildings and mobile homes, and rip away roof coverings and siding. Storm surge of 12 to 18 feet may result in additional damage to low-lying properties. On the east coast, in the area between Miami and West Palm Beach, AIR expects to see damage to roofs and non-structural building components, such as awnings and carports.

“The largest driver of losses will be the concentration of properties on Florida’s east coast between West Palm Beach and Miami. AIR estimates that there is more than $500 billion of insured properties in Miami-Dade and Broward counties alone,” Guin said. “Based on Wilma’s large size, hurricane force winds extend about 90 miles from the center, we expect to see widespread, though less severe, damage on Florida’s east coast.”

It has been exactly one month since Hurricane Rita struck the Texas and Louisiana coasts with similar intensity. At 125 mph, Wilma’s winds slightly exceeded Rita’s 120 mph winds. However, Wilma’s forward speed was near 23 mph-far faster than Rita’s 12 mph.

“Hurricane Wilma’s forward speed increased dramatically after it left the Yucatan and began to interact with an intense trough over the southeastern U.S.,” Guin said. “As a result, Florida has been spared the extended pounding that Wilma inflicted on Mexico’s Yucatan peninsula over the weekend, where it came to a virtual standstill for the better part of two days.”