State Farm, Citizens Brace for Losses From Hurricane Helene

State Farm General Insurance Co. and Citizens Property Insurance Corp. are bracing for the insurance industry’s largest losses from damage caused by Hurricane Helene, which is quickly becoming one of the costliest storms in U.S. history.

State Farm was the leading provider of home and car insurance in Georgia and South Carolina at the end of 2023, according to the most recent data from AM Best, and has significant exposure in Florida and North Carolina. The Illinois-based firm said on Sept. 30 that it had received more than 50,000 auto and homeowner claims related to Helene and expects that number to rise.

In Florida, where Helene first made landfall last week with winds reaching 140 miles per hour, the state-backed Citizens is the state’s biggest insurer. It’s received about 10,000 claims as of Tuesday, a company spokesperson told Bloomberg News.

The total of insured losses from Helene won’t be clear for months at least. The storm wreaked havoc from Florida to Ohio, bringing catastrophic flooding and leaving more than 100 people dead and millions without power.

An early projection from AccuWeather Inc. predicts that total economic damage — a measurement that includes lost wages, canceled flights, and supply chain disruptions — from Helene could hit $160 billion, making it one of the five costliest storms in U.S. history.

But insured losses may be far lower. Flood damage is typically excluded from standard property policies. Homeowners have to buy additional coverage from a private insurer or from the National Flood Insurance Program.

“Unfortunately, fewer than 1% of the homeowners in the most impacted areas outside of Florida had flood insurance,” said Robert Gordon, senior vice president of policy, research and international for the American Property Casualty Insurance Association. “Flood losses are the most common natural disaster but most homeowners outside of designated flood zones have not obtained coverage. According to FEMA, even in high-risk flood zones in Florida, only 35% of structures have protection.”

Property owners in Georgia and South Carolina carry less flood coverage compared with people in Florida, which has been regularly battered by storms. Relative to each state’s economy, Florida has five times as much private flood insurance as Georgia and almost 14 times the federal flood coverage, according to Bloomberg’s calculations.

On Friday, before Helene’s continued damage over the weekend, Corelogic estimated insured losses up to $5 billion. AM Best projected at least that much if not more.

Hurricane Ian was the most expensive storm in recent years, with insured losses higher than $50 billion.

Top photo: Storm-damaged belongings sit along the road in the aftermath of Hurricane Helene in Old Fort, North Carolina on Sept. 30.