US private market insured losses for Hurricane Helene are rising, with Moody’s RMS Event Response now estimating insured losses to be between $8 billion and $14 billion.

The fresh estimates reflect insured wind, storm surge and inland flood impacts. Additionally, they estimate National Flood Insurance Programme losses could reach more than $2 billion.

The new numbers are out as Milton, the thirteenth named storm of the 2024 North Atlantic hurricane season, now also threatens Florida, after raising itself to a Category 3 hurricane.

It is forecast to track west and northwest across the southern and eastern Gulf of Mexico over the coming days, and make landfall as a Cat 3 major hurricane on the west coast of Florida on Wednesday.

Damaging hurricane-force winds are expected to impact the west coast of the Florida peninsula near where the centre makes landfall, and life-threatening storm surge could occur along portions of the area.

Heavy rainfall is forecast across portions of the Florida peninsula and the Florida Keys, which could cause considerable flash, urban and area flooding, and moderate-to-major river flooding.

Hurricane Helene was the sixth named storm of the 2024 North Atlantic hurricane season, and the fourth hurricane to make landfall in the US this season.

The most recent year with three or more landfalling US hurricanes is 2020.

Helene made landfall as a Category 4 major hurricane west-southwest of Perry, Taylor County, Florida on September 27.

Moody’s said that at landfall, Helene had maximum sustained winds of 140 miles per hour (225 kilometres per hour) and a central pressure of 938 hPa, bringing hurricane-force winds, damaging storm surge and heavy rainfall to the Louisiana coastline.

The loss estimate reflects wind losses in Florida, Georgia, the Carolinas and parts of the mid-Atlantic, as well as storm surge losses in Florida, based on an analysis of ensemble footprints in Moody’s RMS Version 23 North Atlantic Hurricane Models. The ensemble footprints are reconstructions of Helene’s hazard that capture the uncertainties surrounding observed winds and storm surge.

The industry estimate also includes impacts from precipitation-induced inland flooding in the affected regions, particularly North Carolina, using flood footprint reconstructions in Version 1.2 of Moody’s RMS US Inland Flood HD Model.

Estimated losses reflect property damage and business interruption to residential, commercial, industrial and automobile lines of business, and consider sources of post-event loss amplification and non-modelled losses from extended power outages, and infrastructure damage to roads, transmission and distribution lines.

Moody’s RMS Event Response expects the private market losses to be driven by wind, with a higher contribution coming from Georgia than Florida. However, storm surge in Florida and floods in North Carolina will also contribute notably to total private market-insured losses.

In contrast, NFIP losses are expected to be largely driven by storm surge in Florida as take-up in the flood-devastated regions in North Carolina is minimal. Insured wind and NFIP losses will be driven by residential lines, while storm surge and inland flood losses to the private market will be driven by commercial, industrial and automobile lines.

With Hurricane Milton due to landfall on Florida’s west coast in the coming days, damage in areas of Florida, where there is overlap between the two storms, may be difficult for claims adjusters to assign them to the event that caused the most damage. This loss estimate is isolated to Helene-specific impacts.

Mohsen Rahnama, chief risk modelling officer, Moody’s, said: “Hurricane Helene is by far the most impactful event of the current 2024 hurricane season, though this may quickly change with Major Hurricane Milton due to impact Florida in the coming days. With Helene, multiple states were affected with different degrees of damage from wind, storm surge, and excessive rainfall-induced flooding.”

Firas Saleh, director, US Inland Flood Models, Moody’s, added: “The worst impacts from this event are from inland flooding, where Helene completely devastated several towns in North Carolina, Tennessee and surrounding states with historical levels of precipitation. Thousands of buildings were exposed to fast-moving waters over eight feet, and several to depths greater than 15 feet. We expect widespread damage and total constructive losses in these regions, with prolonged recovery after the catastrophic infrastructure damage.

“Unfortunately, flood insurance penetration is extremely low in the worst-affected region, meaning most of the damage will be uninsured, and economic property losses will far outweigh insured losses. We expect to see Helene accelerating flood insurance purchases to help close the significant flood protection gap in these regions.”

Raj Vojjala, managing director, Modelling and Analytics, Moody’s, said: “From a wind perspective, the building stock in Florida continues to be resilient, thanks to improved code provisions and the requirement to ‘build back better’ following recent hurricanes like Irma, Ian, Idalia, etc. However, in interior parts of Georgia and the Carolinas, building stock tends to be older, with less stringent enforcement of wind design provisions. Many of these structures with aged roofs did not withstand damaging winds that extended far inland in Helene due to the fast forward speed of the storm.”