The latest estimates about the potential impact of hurricanes during the looming summer and fall months show that there probably won’t be a significant amount of activity any time soon. That will likely be very good news for the property and casualty sector in particular, as well as insurance agents operating in states where they may be at greater risk of being affected by such storms overall.
While moderate risk of a hurricane making landfall during the coming months still remains, there is nonetheless a general sense that the chances of this taking place are low – meaning that P/C insurers aren’t likely to face a major threat from significant losses related to claims during that time, according to a report from the Insurance Journal based on the latest analysis from Fitch Ratings. Even if a storm or two hits the Eastern Seaboard or Gulf Coast of the U.S. this year, it would have to be quite significant to surpass 15-plus percent of the industry’s surpluses, which have been set aside for losses in particular.
“From the perspective of the insurance industry, the intensity and location of storms making landfall are the most critical variables,” said Christopher Grimes, director for Fitch Ratings, according to the site. “While fewer and less severe storms bode well for the industry, the property/casualty segment remains positioned to withstand the impact of future significant events.”
More good news
In addition to the fact that insurers are unlikely to suffer significant losses as a result of a major hurricane, there’s also the fact that many such companies have made sure to better position themselves to be insulated from these issues, the report said. A number of positive financial steps have been taken by the industry in the wake of the losses suffered as a result of Hurricane Sandy a few years ago, and as such, risk is now greatly reduced.
Insurance agents might see these readings for the likelihood of a relatively claim-free hurricane season as good news overall for their customers, because they will likely face a significantly reduced threat. However, that doesn’t mean these professionals should rest on their laurels; they might want to take this less stressful time to work with clients as a means of better educating them about what their policies will and will not cover in the event of any kind of major storm of this type. That could help to prepare those people for potential future issues, and improve customer satisfaction overall.