RMS Estimates Industry Losses of $500M from Hurricane Isabel

Risk Management Solutions (RMS) projected that Hurricane Isabel could cause insured losses in the $500 million range if the storm continues on its current track toward Cape Lookout in North Carolina.

If the storm makes landfall further north, with a more direct strike on Norfolk, Virginia Beach, and the Chesapeake Bay region, insured losses could be as high as $2 billion. Hurricane Isabel is currently a borderline category 2-3 storm, and is expected to make landfall on Thursday afternoon (local time).

“There is continuing uncertainty around Hurricane Isabel’s intensity at landfall and its track,” commented Brian Owens, meteorologist and director of technical marketing at RMS. “But the meteorological factors that have been guiding Isabel’s track, including a high pressure system over the Northeast, are expected to remain stable, steering Isabel away from the areas of higher exposure further to the north.”

RMS will continue to monitor the hurricane as it approaches land. Windspeeds at landfall are currently forecast to be in the range of 100 to 110 mph, making the storm a strong category 2 hurricane based on windspeed. Losses related to storm surge could extend into Chesapeake Bay, particularly if the storm makes landfall further to the north.