Lloyd’s of London underwriter Hiscox is predicting the price of property insurance in the US will spike in the wake of hurricanes Harvey and Irma.
The hurricanes, which slammed into Texas and Florida in quick succession, inflicted billions of dollars in damages.
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“This will definitely have the impact of eliminating price reductions,” Hiscox CEO Bronek Masojada told Reuters. “I think that loss-affected areas will see price rises. The bigger-ticket property area will see price rises because that was a very underpriced area beforehand.”
But Masojada predicted that the price hikes won’t be limited to areas impacted by the storms.
“People buy programs covering all of their property wherever they are in America,” he said. “So (price rises) will be broader than just Texas and Florida.”
AIR Worldwide forecast total insured losses for Irma between $20 billion and $40 billion, Reuters reported. And risk-modeling firm RMS estimated that Harvey caused insured losses of between $25 billion and $35 billion.