Hurricane Dorian will cause insurance industry losses of at least $25 billion, according to analysts at Swiss investment bank UBS Group AG.
But if the Category 5 storm hits the eastern coast of Florida, it could inflict losses of up to $40 billion, according to the analysts, Bloomberg News reported.
The last natural disaster to cause more than $25 billion of insured damages was Hurricane Maria in 2017, according to Munich Re, which compiles a database of the biggest losses.
The word’s biggest reinsurers have maintained excess capital of $30 billion as the industry has benefited from relatively few major disasters since that storm, according to UBS.
But the bank estimated that the likely losses from Dorian would eat into that capital, possibly causing the reinsurers to alter their prices with estimates of about $70 billion in natural catastrophe losses this year.
In 2017, insurers faced record bills of over $135 billion from hurricanes, earthquakes and wildfires, according to Reuters.
Dorian — which already the most powerful storm to make landfall in the Atlantic since the 1935 Labor Day hurricane — is moving at a snail’s pace toward the US east coast.