Cost of Hurricane Rita Lower Than Expected but Still in Top Ten

Insurers including Allstate Corp. and St. Paul Travelers Cos. estimate insured storm damage from Hurricane Rita may reach $6 billion, Bloomberg.com reports, less than a third of analysts’ early predictions. Paul Supple of State Farm Insurance said that estimates were lower because Rita’s path took it to the east of the densely populated areas of Galveston and Houston.

Robert Hartwig, chief economist with the Insurance Information Institute estimates the cost may be less, $4.5 billion. “We dodged a bullet,” he told the LA Times, but his estimate would still put Rita among the 10 most costly hurricanes to hit the US.

Insurance claims for Katrina, the most expensive storm in history, could go as high as $60 billion, Bloomberg.com reports. Charley and Ivan, two of the four storms that struck Florida last year, each cost insurers more than $7 billion.

It is still too early to estimate costs to the nation’s energy infrastructure from Rita, the Wall Street Journal reports. Information has not yet been released about damage offshore, to the platforms that pump oil and natural gas and the underwater pipelines that carry the oil and gas. Very little infrastructure damage caused by Katrina has been repaired to date, according to the Journal.

Valero Energy’s refinery near Port Arthur suffered “significant damage” according to the Journal report, and could take a month to restart. Other refineries reported minor damage.

Governor Kathleen Blanco of Louisiana has announced that she will ask Congress for $20.2 billion to rebuild and upgrade levees and pumping capacity around New Orleans and Morgan City, Louisiana, Reuters reports. An additional $11.5 billion will be needed to repair the transportation infrastructure, including highways, ports and airports, the governor said.

You may like these other stories...

The Public Company Accounting Oversight Board (PCAOB) on Monday reminded auditors that they should continue adhering to the board’s existing standards when considering an organization’s ability to operate as a...
Exclusive: Lois Lerner breaks silenceIn her first press interview since the IRS Tea Party targeting scandal broke 16 months ago, ex-agency official Lois Lerner told Politico that employers won’t hire her, she’s...
Cybersecurity is no longer the domain of an organization's IT staff. It's moved to the boardroom, and in a big way. Accountants and financial managers may have been thinking it's just the province of the tech...

Already a member? log in here.

Upcoming CPE Webinars

Sep 24
In this jam-packed presentation Excel expert David Ringstrom, CPA will give you a crash-course in creating spreadsheet-based dashboards. A dashboard condenses large amounts of data into a compact space, yet enables the end user to easily drill down into details when warranted.
Sep 30
This webcast will include discussions of important issues in SSARS No. 19 and the current status of proposed changes by the Accounting and Review Services Committee in these statements.
Oct 21
Kristen Rampe will share how to speak and write more effectively by understanding your own and your audience's communication style.
Oct 23
Amber Setter will show the value of leadership assessments as tools for individual and organizational leadership development initiatives.