Analysts are estimating that Hurricane Idalia may become the most costly climate disaster in the US this year, according to a report.
The storm — which made landfall near Big Bend, Florida, on Wednesday as a Category 3 hurricane — caused an estimated $9.36bn based on early estimates from UBS, a risk analysis firm. However, those are only early estimates; Accuweather predicted the total damage could be somewhere between $18bn and $20bn.
The costs of climate disasters like Hurricane Idalia and the 15 other incidents recorded this year by the National Oceanic and Atmospheric Administration are becoming especially costly for insurers and risk management companies, according to The Guardian.
Tom Larsen, the senior director of insurance solutions at CoreLogic, which provides property analytics and publishes an annual hurricane risk report, told the newspaper that the "costs are becoming unbearable."
“The business of insuring for catastrophes used to mean exceptional, very rare events and that’s not what we’re seeing," he said. "These are much more common, so something’s got to change.”
The NOAA estimated that by the end of July, the total estimated cost caused by the 15 disasters was $39.7bn, which does not include the estimated $5.5bn needed to rebuild Lahaina following what became the deadliest wildfire in the US in more than a century.
Mr Larsen noted that the only positive is that Hurricane Idalia was not as destructive as it could have been, as it struck a relatively rural part of Florida. Hurricane Ian, by comparison, caused $113bn in damage when it hit the Fort Myers area last year.
But the cost of doing business in Florida has already driven some insurance companies out of business, even with the state government's attempts to appeal to the industry.
Consumers will ultimately pay the price of skyrocketing premiums as few insurance providers choose to make plans available in Florida, further worsening the ongoing home insurance crisis facing Americans.
Mr Larsen said mitigation efforts — like more resilient homes that better withstand the battering of increasingly powerful hurricanes due to the climate crisis — are needed to keep prices reasonable.
The remnants of Hurricane Idalia — now a tropical storm — have moved through Florida and are now battering the Carolinas with rain and life-threatening flooding.
As the storm continues to batter parts of the US, Floridians are beginning to pick up the pieces as floodwaters subside and utility companies work to restore power.