Bermuda could see a more active hurricane season, fuelled by warmer ocean temperatures, journalists learnt at an online briefing by ratings agency Moody’s.

In the central Atlantic, the sea surface temperatures are already at levels normally seen in May and June, reporters were told.

Moody’s assistant director of event response, James Cosgrove did concede that accurate predictions were difficult.

“We will have more certainty in spring and early summer,” he said.

During the meeting, Natalie Ambrosio Preudhomme, associate director of commercial real estate at Moody’s, said hurricanes and other catastrophes were causing challenging market conditions for insurers.

“Together, these factors have come together to create what we have been calling a crisis of affordability and availability for insurance and commercial real estate,” Ms Preudhomme said.

“Transactions have been stalling because borrowers are having challenges obtaining the insurance coverage required by their lenders, without premiums being so high, that they create a cashflow risk.”

Julie Serakos, managing director of model product management, said combined ratios had been more than 100 per cent for the past five years, which means carriers were not taking in enough money to really cover their risk.

She said rising insurance rates over the past five years were creating an “unhealthy” market.

“Many people are feeling the pinch, myself included,” Ms Serakos said. “I have noticed a doubling of my homeowner’s premium in the last couple of years. It is impacting a lot of people.”

She thought more conversation was needed between client and carrier about improving properties as much as possible to protect against natural disasters such as hurricanes.

Ms Serakos said Moody’s was creating a new model looking at severe convective storms, which will be on the market in due course.

“It certainly will be well received and well needed by the marketplace to continue to inform severe convective storm risk and for more effective portfolio management and reinsurance design, to support the market against that risk,” she said.

Moody’s uses artificial intelligence in a number of areas when they are developing models.

“A lot of it has to do with a better representation of the underlying hazards,” Ms Serakos said.

A year ago, Moody’s predicted a near normal hurricane season for 2023, anticipating that El Niño would dull the impact of above-average North Atlantic Sea surface temperatures.

El Niño did impact the Atlantic basin but could not shut down activity.

In fact, the 2023 hurricane season was the fourth most active behind 2020, 2005 and 2021. There were 20 named storms, seven hurricanes and three major hurricanes last year.

However, most hurricane metrics were near average. Moody’s experts said it was a case of quantity over quality.

“Now, we are anticipating a fading El Niño pattern through the rest of the winter and the early spring,” Mr Cosgrove said. “By June 1, we are anticipating that will transition to a neutral or possibly à La Niña phase.”

Moody’s insured loss estimate for Hurricane Idalia, which hit Florida last year, was $3 billion to $5 billion compared with $53 billion to $74 billion after Hurricane Ian struck the state the previous year.

According to Moody’s there is a feeling of “cautious optimism” about the Florida market, which shows signs of stabilisation after the ravages of Hurricane Ian.