Hurricane Irene may not have wreaked the havoc of Biblical proportions that some may have feared, but it will beat up an insurance industry bruised by a spate of springtime storms, experts say.
The hurricane's price tag may come to around $7 billion, according to Kinetic Analysis Corporation in Silver Spring, Md. But even before Atlantic hurricane season started in June, tornadoes and other storms tore across a large swath of the country.
Eqecat, a company in Oakland, Calif., that models the effects of natural disasters, says tornadoes alone were costing insurers up to $18 billion so far this year, with up to $7 billion of that from just three days, April 25 through 28, according to the New York Times.
Those three days were "likely the most expensive tornado outbreak ever in the United States," according to Eqecat, the Times adds
Add to that, many insurance companies were exposed to the Japanese earthquake.
Meanwhile, one problem that many insurees may encounter is discovering their insurance may cover wind damage but not floods, which Irene unleashed all up the eastern seaboard.
"Many Americans underestimate the risk of flood damage [from a hurricane]," says Michael Barry, a spokesman for the Insurance Information Institute, CNNMoney reports. Many insurance companies require homeowners to buy flood insurance separately.
According to Barry, only 20 percent of all U.S. homes are covered by flood insurance, CNNMoney adds.
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