### Hurricane Milton Could Lead to $100 Billion in Insurance Losses, Analysts Warn

Hurricane Milton is on the verge of causing massive financial losses for the global insurance industry, with projections estimating a potential $100 billion impact. Experts believe this could significantly increase reinsurance prices by 2025, a development that may benefit certain insurance firms' shares.

The Category 5 hurricane is poised to strike Florida's Gulf Coast late Wednesday or early Thursday. This imminent disaster comes on the heels of Hurricane Helene, which wreaked havoc on the region less than two weeks ago.

According to Morningstar DBRS analysts, if Milton makes a direct hit on Tampa's densely populated area, insured losses could range from $60 billion to $100 billion. Should losses reach the upper end of this range, Milton would rival Hurricane Katrina in 2005, which holds the record for the largest insured hurricane loss to date.

RBC analysts have suggested that Milton could result in losses comparable to Hurricane Ian, which caused around $60 billion in damages when it struck Florida in 2022. They describe these potential losses as "very manageable" for the insurance industry. Jefferies analysts estimate that a significant impact in one of Florida’s most heavily populated regions could lead to mid-double-digit billion-dollar losses.

The possible scale of devastation is highlighted by estimates that a 1-in-100-year event could result in $175 billion in losses if the Tampa area is hit directly, and $70 billion for the Ft Myers region.

Insurers and reinsurers are adjusting to the increasing frequency and severity of natural catastrophes, which scientists attribute to climate change. They have been raising rates and excluding high-risk ventures from their policies. RBC analysts point out that improved reinsurance contract terms, widespread earnings diversification, and larger reserve buffers are fortifying the sector, making it more resilient than in previous years.