Insurers Processing Estimated $1.2 Billion in Hurricane Isaac Claims

Insurance claims from Hurricane Isaac have starting coming in, with one estimate saying losses to insurers could total $1.2 billion.

AIR Worldwide, which models losses for insurers, said its best estimate of losses was $1.2 billion. Insurers could have to pay up to $2 billion if it turns out winds were higher and rains produce heavy flooding, but only $700 million if losses turn out to be less.

An earlier estimate from EQECAT, another modeling firm, put Isaac’s insured damages onshore in the U.S. as between $500 million and $1.5 billion.

State Farm Insurance Cos., the largest insurer in Louisiana and Mississippi, said it had received 4,266 homeowners’ insurance claims in the two states — 3,805 in Louisiana and 461 in Mississippi. The company had received 1,144 automobile claims — 998 in Louisiana and 146 in Mississippi.

Jim Rowles, claims manager for Mississippi Farm Bureau Insurance, said the firm had received more 600 homeowners claims as of Friday, mostly in the southwestern part of the state. The firm is the second-largest homeowners’ insurer in Mississippi.

Sister company Louisiana Farm Bureau Casualty Insurance Co. had also received about 600 homeowners claims Friday, along with 125 auto claims, said claims manager Bob Warner.

“Losses are not developing at a real high rate,” said Warner, although he said the firm doesn’t cover many properties against wind in metro New Orleans.

He said flood claims may be slow to come in because many areas were still flooded Friday in Louisiana. Farm Bureau is the third-largest homeowners’ insurer in Louisiana.

The Mississippi Windstorm Underwriting Association had received about 400 claims by late Friday, assistant manager Brad Little said. Warren said many claims filed with the insurer of last resort appeared to be worth less than the policyholder’s deductible, meaning the company wouldn’t have to pay anything.

Allstate Corp., which is the second largest insurer in Louisiana and third largest in Mississippi, declined to release the number of claims it has received so far.

A spokesman for the Federal Emergency Management Agency said there were no statistics yet on how many federal flood insurance claims had been filed, and the agency doesn’t expect to have even preliminary statistics for 30 days.

“It’s too soon to tell right now,” spokesman Lars Anderson said.