Insured losses to onshore property resulting from Hurricane Ida’s winds and storm surge will range from $17 billion to $25 billion, according to estimates from modeling firm AIR Worldwide.
AIR’s modeled insured loss estimates include insured physical damage to property (residential, commercial, industrial, auto), both structures and their contents from winds, wind-borne debris, storm surge and the impact of demand surge.
The Verisk subsidiary’s industry loss estimates also reflect an adjustment to account for increased material and other repair costs in the current construction market. Hurricane flood losses are not included in AIR estimates at this time.
Ida made two landfalls in Louisiana on Aug. 29, both at Category 4 strength. The storm’s first landfall was near Port Fourchon about 60 miles south of New Orleans, with a maximum sustained wind speed of 150 mph; its second landfall was southwest of Galliano, with a maximum sustained wind speed of 145 mph. New Orleans experienced strong winds on the order of 90-100 mph due to the large windfield and a slow decay of the storm.
According to AIR, the storm surge Ida produced was along expected lines and generally not as severe as Hurricane Katrina’s—particularly in Mississippi and New Orleans — which was fully protected by the city’s levee system. However, some areas of southeastern Louisiana with insufficient protection experienced severe storm surge during Ida.
Hurricane Ida has had a significant impact on Louisiana refinery operations and Gulf of Mexico production, causing a crude supply chain disruption. According to another Verisk company, 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 and payouts.
While New Orleans’ levees held, the city was not spared Ida’s wind impacts. Areas close to where Ida made landfall such as LaFourche Parish, where Port Fourchon is located, were particularly hard hit. Grand Isle Parish, a barrier island, has been declared uninhabitable. Even in towns just inland from where Ida came ashore, such as Galliano and Houma, wind damage was severe to catastrophic, according to AIR.
In terms of storm surge, most New Orleans levees held up well, but some communities to the north, west, south and east of the hurricane protection system that surrounds New Orleans were inundated. Ida’s storm surge inundated far into the bayous and inhabited areas of southeastern Louisiana, as well as areas near Lake Pontchartrain. Minor near-coastal inundation also occurred in Mississippi and Alabama. Key areas flooded by storm surge in Louisiana include Port Fourchon, Grand Isle, Delacroix, Alliance, Lafitte, Jean Lafitte, Barataria, Laplace, Mandeville, Braithwaite, Shell Beach, Galliano, Golden Meadow and Venetian Isles. Surge inundation depth exceeded 10 feet in some places, but several tide gauges near maximum storm surge broke, leading to uncertainty in Ida’s maximum storm surge water level.
According to AIR and Xactware, materials costs have gone up “significantly” in the past year from supply chain disruption in the construction market. Although these costs have moderated since their peak in July when they were 80 percent higher than September of last year, they remain about 30 percent higher. Repair costs are still up significantly, the estimating firms said.
Source: AIR Worldwide
*This story was originally published by our sister publication Insurance Journal
Photo: Homes, businesses and roads are flooded in the aftermath of Hurricane Ida in LaPlace, La., Tuesday, Aug. 31, 2021. (AP Photo/Gerald Herbert)