Preliminary reports show the insurance bill from Isaac could be anywhere from $5000 million to $1.5 billion. As hurricanes go, that’s pretty small - especially compared to Hurricane Katrina, the last major storm to hit the region.
Two Illinois-based insurance companies, Allstate (Northbrook) and State Farm (Bloomington), have the largest exposure for personal property claims.
State Farm was the largest homeowner’s insurer in Louisana last year, with 29 percent of the market, according to SNL Financial. Allstate Corp., the next highest, held about a 13 percent market share.
State Farm spokeswoman Missy Dundov said so far, in the past two days, they’ve already received about 860 claims from homeowners and another 124 from auto policies.
“It’s not going to be the kind of impact Katrina had,” she said.
When Hurricane Katrina hit in 2005, claims from that - combined with the other storms that year, rocked the insurance industry. Katrina claims alone led to Allstate having its biggest ever quarterly loss as a public company, more than $1.55 billion.
But Morningstar insurance analyst Drew Woodbury says post-Katrina, things have changed for the entire industry.
“Since then we’ve seen Allstate and other companies adjust pricing, make terms and conditions a little tighter, so there is a little bit more copayments for the insured, and Allstate specificallly has backed away from the most catastrophe-exposed areas, to reduce its volality,” he said.
Insurers have also used much more reinsurance, he added, passing off a lot of risk.
“A storm such as this - we’ll see losses that they’ll probably announce, but it won’t materially impact their financial position or anything like that.”