Still Reeling From Ian, Florida Faces Costs of Hurricane Nicole

Hurricane Nicole hit Florida’s east coast early Thursday morning. The tropical cyclone comes just six weeks after Hurricane Ian devastated the state, leaving Florida residents — and insurers — little time to recover before the onslaught a second natural disaster.

A Category 1 hurricane, Nicole brought winds of 75 mph, storm surges and torrential rain as it made landfall in Florida. Parts of South Carolina and Georgia also felt the effects of the storm, which is expected to hit areas as far north as Maine over the weekend, according to the National Weather Service.

Florida has yet to recover from Hurricane Ian, a Category 4 hurricane that struck the state’s Gulf Coast on September 28. Its impact is still being studied, but Ian was quickly dubbed one of the costliest storms the state has ever seen, according to the National Oceanic and Atmospheric Administration’s National Centers for Environmental Information.

RMS, an analytics firm that performs disaster risk management, estimates that Hurricane Ian caused $53 billion to $74 billion in damage to privately insured properties in Florida, Georgia, North Carolina, South Carolina and Virginia. In addition to privately insured losses, RMS estimated an additional $10 billion in flood losses that would be covered by the National Flood Insurance Program.

In addition, the Federal Emergency Management Agency has paid more than $2 billion in grants, disaster loans and flood insurance payments to support the recovery from Hurricane Ian, according to a Nov. 7 news release from FEMA.

By the time Ian landed, Florida’s homeowners insurance industry was already facing a crisis: According to the Insurance Information Institute, Floridans pay three times more for home insurance than the national average. Despite this, six insurers in the state were declared bankrupt this year, leaving them unable to pay out their claims.

With the catastrophic damage from Hurricane Ian adding to the existing problem, insurance industry experts fear that neither insurers nor Florida residents were prepared for Nicole. This is only the fourth hurricane since 1851 to make landfall this late in the season, which runs from June to November each year. According to NOAA, most storms that make landfall fall between August and October.

Two storms in rapid succession are likely to weigh on all aspects of the recovery process.

Mark Friedlander, Florida-based director of corporate communications for the Insurance Information Institute, says insurance companies tested by Hurricane Ian may not be able to cover damage from another storm.

“We anticipate that this will be a worst-case scenario for Florida’s already battered property insurance market,” Friedlander said. “While insurers appear to be able to pay claims from Hurricane Ian, it is not known if they will be able to pay claims from any other hurricane.”

People should expect a slow one insurance claims Process. From assessing property damage to repairing and replacing damaged property, everything is likely to be affected by staffing shortages and supply chain bottlenecks. For example, the national auto market was in crisis long before Hurricane Ian crashed through Florida could make it difficult to quickly replace a vehicle.

Additionally, only about 20% of claims filed after Hurricane Ian were paid out, Friedlander said in an email.

Still, people with storm damage should make their claims as soon as possible.

After a claim is filed, homeowners may be in a rush to complete repairs, but thinking about material and design changes that could make a home more resilient to future storms could help in the long run, says Mark Misczak, senior vice president and chief operating officer with Tidal Basin, a disaster risk management consultancy.

“There are things that are easier to do during construction to make a house more resilient,” says Misczak.

It is also the time to evaluate Hurricane Insurance Coverageincluding flood insurance, even for people unaffected by recent storms.