Despite being a category five storm, Hurricane Felix is currently expected to create only about $200 million of insured losses as it hits Central America.

The early assessment has been made by California's Risk Management Solutions, which provides products and services for catastrophe risk management.

If accurate it would present a much lower insured loss than Hurricane Dean, which is thought to have caused between $1.5 billion and $2bn after hitting Jamaica and Mexico two weeks ago.

Although a relatively small storm, Felix quickly strengthened to maximum strength at the weekend, lost some power but returned to Category 5 status yesterday as hit the border areas between Honduras and Nicaragua.

It's path along the bottom edge of the Caribbean closely parallels that of Hurricane Dean, which was slightly more northerly.

The persistent high pressure system that normally sits over Bermuda during the summer is further south this year and that is one of the reasons why the first two hurricanes of the season have followed such southerly tracks, with the high acting as a barrier to protect the US from hurricanes veering towards Florida and other southern states.

It also means the hurricanes are forming over much warmer seas than usual, and this explains why the first two hurricanes of the season have both attained maximum Category 5 strength - an unprecedented occurence.

Dr Claire Souch, senior director of model management at Risk Management Solutions, said: "The similar paths taken by the two hurricanes is a result of a persistent high pressure weather system which is usually located further northeast in the Atlantic around Bermuda. The high is currently positioned over Florida and the Gulf of Mexico, directing the tracks to the western Caribbean where Atlantic sea surface temperatures are hottest. The warmth of this water intensifies any storms that pass over the area.

"This is only the fourth year since 1950 that we've had more than one Category 5 storm and it is unprecedented for the first two hurricanes of the season to reach this level of intensity.

"The northern hemisphere weather systems have remained very stable for some weeks and this has led to yet another year of storm tracks clustering. During the 2006 hurricane season, high pressure over the Azores caused storms to recurve without hitting land, while in the highly active 2004 and 2005 seasons the Bermuda High guided hurricanes to hit Florida and the US Gulf Coast through August and September."

RMS' chief research officer Robert Muir Wood, added: "The location of the high pressure system is currently protecting the US, as storm tracks are being kept further south. However, we are not yet halfway through the hurricane season and stable weather tends to break down during September, so there is no guarantee that the protection will remain in place."

He added: "While two maximum-strength hurricanes could be cited as evidence of climate change, both the tracks of these storms have been guided over a region known to be a great hurricane intensifier. Belize, which was hit by Category 4 hurricanes Keith and Iris in 2000 and 2001, is in the firing line of these intense storms."

Hurricane Felix's high forward speed means it will not bring the exceptional rainfall that accompanied Hurricane Mitch in 1998, a large slow-moving Category 5 storm that resulted in extreme flooding to Honduras and caused almost 20,000 deaths.

Yesterday Felix reached land, striking a scarcely populated area of Central America, having previously passed by Aruba and the Netherland Antilles as a much weaker hurricane.

The small population combined with relative poverty and low insurance penetration in the area means the economic loss will be low, though the humanitarian cost will be high.

Most of the destruction is expected to be from flooding and landslides as a result of the hurricane, rather than from the wind.

Mitch caused economic damage of $5bn in 1998, but insured losses were no more than $300m.

"Central America is an extremely hazardous region, at risk not just from hurricanes but also floods, landslides and earthquakes, and has a very vulnerable population. The low level of insurance or other effective risk management strategies means recovery from catastrophic events is often delayed, as was the case with Hurricane Mitch," said Dr. Souch, of RMS.