Hurricane Debby is expected to be a "very manageable event" for the insurance industry, but many homeowners in drenched inland areas could face cleaning up without flood insurance, according to an analysis by the global reinsurance broker Gallagher Re.
The analysis, which looked at the effects of the storm in Florida and other states, said insured losses for the private insurance market and the National Flood Insurance Program likely will total $1 billion to $2 billion.
Debby made landfall Monday morning as a Category 1 hurricane near Steinhatchee in Taylor County, before bringing heavy rain to other parts of rural North Florida, Georgia and South Carolina. Wind-related losses are expected to total hundreds of millions of dollars, with Gallagher Re indicating the location of the storm’s landfall prevented more-extensive wind damage.
“Overall, wind related impacts in Florida were limited due to the sparsely populated nature of the Big Bend region,” the analysis, which was released Thursday, said.
Gallagher Re, however, said insured losses from coastal and inland flooding “remain more complex.”
READ MORE: Complete coverage of Hurricane Debby
“There has already been reports of widespread flood inundation with additional impacts yet to come, despite not reaching the magnitude of Florence,” the analysis said, referring to 2018’s Hurricane Florence, which made landfall in North Carolina and caused extensive flooding. “The private insurance market is expected to face losses in the hundreds of millions primarily from auto policies and privately written residential or commercial flood policies. Payouts from the NFIP (National Flood Insurance Program) are also expected into the hundreds of millions depending on the final expanse of the rainfall/flood footprint.”
Also, the analysis said what are known as economic losses — which include insured and uninsured losses — are likely to be “far higher” because of flood damage.
“Debby generated copious inland rainfall and coastal storm surge inundation across multiple tidal cycles which resulted in costly impacts,” the analysis said. “As much as 12 to 18+ (inches) of rain had been measured across a wide swath of Florida, Georgia, the Carolinas. This scope of damage, plus additional water-related impacts possible in the Mid-Atlantic and Northeast, is expected to drive a multi-billion-dollar economic loss total.”
That could particularly hit homeowners who don’t have flood insurance. Homeowners with mortgages are generally required to have flood insurance in high-risk areas. But most homeowners in other areas, such as inland regions, typically don’t have flood coverage.
“While coastal counties in Florida, Georgia, and South Carolina have National Flood Insurance Program take-up ranging from 10% to 50%, the percentage of active policies drops dramatically once inland,” the Gallagher Re analysis said. “This means a sizeable portion of flood damage is likely to be uninsured.”
Hurricane Idalia made landfall in August 2023 in Taylor County as a Category 3 storm and followed a similar path as the weaker Debby. Gallagher Re said the National Flood Insurance Program had more than $380 million in payouts from Idalia, with the bulk of those losses in the Tampa Bay region. Both storms caused flooding in the Tampa Bay region and other coastal areas as they moved up the Gulf of Mexico.
As of Thursday, insurers had reported 8,856 claims in Florida from Debby, totaling $66.7 million in estimated insured losses, according to data posted on the state Office of Insurance Regulation website. Those totals will increase as additional claims are filed.
Of the initial batch, 5,527 claims involved residential property, with other claims stemming from damage to such things as vehicles and commercial property, according to the Office of Insurance Regulation.
