Losses from Tropical Storm Debby, which has claimed at least seven lives, are unlikely to affect reinsurers, according to Moody’s.

Debby made landfall near Steinhatchee, Florida, on Monday morning as a category one hurricane, later losing strength to become a tropical storm as it moved along the US East Coast.

It brought widespread flooding and caused the cancellation of more than 1,700 flights.

However, James Eck, vice-president senior credit officer, at financial institutions group Moody’s Ratings, said: “We expect a majority of insured losses from Debby to fall within primary insurers’ retentions under their reinsurance coverages.

“In general, primary insurers are retaining more risk this hurricane season as attachment points — the threshold at which a policy begins to cover a loss — have moved higher over the past few years, with primary companies taking on more of the loss burden from reinsurers for small to midsize catastrophe events.”

Sarah Hartley, Director, Moody’s RMS Event Response, added: “Following Hurricane Beryl, which was the earliest Category 5 hurricane on record in the North Atlantic Basin, Hurricane Debby was the second US hurricane landfall of 2024, which is forecast to be an active hurricane season.

“Although Hurricane Debby made landfall in Florida's Big Bend region just 15 miles from where Hurricane Idalia made landfall in August 2023, Debby was less intense, at Category 1 rather than Category 3.

“Latest forecasts suggest up to 30in of rain, particularly in Georgia and South Carolina, which could challenge recent historical precedents in those states.”

She added: “Debby’s forecast winds, rainfall, storm surge and the associated risk of tornadoes highlight the multifaceted nature of hurricane-related risks facing insurance industries.”

Multiple preseason forecasts have warned that warm waters and the likely arrival of La Niña conditions could lead to a “hyperactive” hurricane season.

Forecasters are expecting 22 named storms, compared with the historical average of 14 a year between 1991 and 2020.

In addition, AccuWeather said meteorologists were concerned at the speed with which storms would be able to build into a threat, leaving less time for areas at risk to batten down or evacuate.

Speaking earlier this year, Chris Lafakis, climate economist at Moody’s Analytics, said: “While the 2023 hurricane season was devoid of costly hurricanes, the long-term trend is dire.”

He said the United States avoided a truly catastrophic hurricane season last year, but if forecasters are correct, they may not be so lucky in 2024.

Mr Lafakis added: “With few signs of a slowdown in building in high-risk coastal areas, a major storm would have significant consequences, not only in terms of the human toll but when it comes to lost output and property damage.”