Insurers with exposure to Florida were rallying Tuesday, up as much as 7.2 pecent, after Hurricane Dorian was forecast to veer away from the state.
The slow moving hurricane, which was downgraded to a category 2 storm, is likely to move “dangerously close” to Florida’s east coast through Wednesday evening before heading up the coast to Georgia and South Carolina, according to the National Hurricane Center.
HCI Group, Heritage Insurance, United Insurance Holdings and Universal Insurance Holdings were all sharply higher.
|HCI||HOMEOWNERS CHOICE INC.||67.97||-2.67||-3.79%|
|HRTG||HERITAGE INSURANCE HOLDINGS INC.||6.05||-0.20||-3.20%|
|UIHC||UNITED INSURANCE HOLDINGS CORP||4.18||-0.12||-2.79%|
|UVE||UNIVERSAL INSURANCE HOLDINGS||19.21||-0.17||-0.88%|
Still, the insurers aren’t out of the woods just yet as the storm is expected to dump up to 5 inches of rain on the Daytona Beach area.
"It's going through some structural changes in terms of the eye and when it does that, the wind field expands," Fox News Senior Meteorologist Janice Dean said on "Fox and Friends," adding that it’ll get larger and affect more territory even if the strongest winds stay offshore.
In a note sent out to clients on Friday, UBS said Dorian could cost insurers anywhere from $5 billion to $40 billion, with its base case being $25 billion, according to reports. The bank’s analysts estimate the U.S. will see $70 billion in natural catastrophe losses this year.