Earlier this morning, JPMorgan released a statement to its clients about the estimated total losses incurred by Hurricane Harvey. They estimated a total loss of around $10 billion up to $20 billion—just under 25 percent of the insurance industry’s total earnings.
This massive sum is far below the estimates published by other firms on Friday—estimates that JPMorgan analyst Sarah DeWitt said were erroneously based only on wind damage and not flooding damage. The reason why is simple: flooding isn’t usually covered by homeowner’s insurance; it’s usually covered by the government. However, flooding is covered under commercial insurance.
Among the commercial property insurers in Houston, State Farm, Allstate, and Farmers are likely to be covering most of the losses caused by Hurricane Harvey—one of the largest hurricanes in recent history.
Heavy Rainfall to Continue This Week
Weather reports coming out of Houston anticipate continued heavy rainfall and flooding for another week. The National Weather Service is forecasting up to 50 inches of rainfall in the coming week. As reported by the Washington Post, experts estimate that Hurricane Harvey has already unleashed over 9 trillion gallons of water onto the Houston area—roughly the equivalent of nearly two Great Salt Lakes falling from the sky. JPMorgan considers it among the top 10 most damaging and costly hurricanes ever.
As reported by CNN, Dallas is turning its convention center into a “mega-shelter” to accommodate those displaced by the storm. While Hurricane Harvey is no longer classified as a hurricane, the flooding caused by the storm has been called “unprecedented” by the National Weather Service.
If you’re currently or potentially facing evacuation, make sure you have a go-bag ready to grab if you haven’t already. Whatever you do, please listen to local authorities if they insist that you leave your home. Do not wait it out. Rescue operations are ongoing, but nearly all agencies on the ground are being pushed to their limits.