RMS has estimated that the insured loss from Hurricane Harvey will be between $25 to $35 billion, with an upper bound of $40 billion. This RMS estimate represents the insured losses associated with wind, storm surge, and inland flood damage, across Texas and Louisiana only. The estimate also includes gross losses accrued to the National Flood Insurance Program of $7 to $10 billion.
RMS Best Industry Loss Estimate Ranges by Peril and U.S. State, in US$ Billions
RegionWindStorm SurgeInland FloodTotal
Texas2 - 3< 0.120 - 3522 - 38
Louisiana--1 - 21 - 2
Total2 - 3< 0.121 - 3722 - 40
“Although Harvey was a category four storm at landfall, the point of landfall along the coastline of Texas is less densely populated than other coastline areas, which has limited the magnitude of the overall total wind and surge related losses,” said Michael Young, head of U.S. climates modeling at RMS.
While wind and storm surge losses appear modest for a landfalling category four hurricane, RMS expects that significant losses associated with rainfall-driven flooding will drive total economic and insured losses in excess of those experienced from Superstorm Sandy in 2012.
Major Hurricane Harvey caused catastrophic and unprecedented inland flooding across southeast Texas and parts of southern Louisiana. Most of the Houston metropolitan area (pop. ~6.3 million) was significantly impacted. Flood depths in the Houston metropolitan area reached up to 12ft (3.66m) in some places.
“The behavior of the storm is almost without precedent, and Harvey has already broken all U.S. records for tropical cyclone-driven extreme rainfall. Harvey's observed cumulative rainfall of 51in (129cm) far exceeds that of Allison in 200, Claudette in 1979, or Amelia in 1978, not only in volume but also in regional extent," said Young.
RMS ran the upcoming RMS U.S. Inland Flood HD Model in real-time to simulate the precipitation, run-off, and pluvial and fluvial flows across the Texas and Louisiana domain, to create a series of high-fidelity flood maps for clients to use to estimate expected flood losses.
The model was used to evaluate all sources of coastal and inland flood hazard, including: tropical and non-tropical cyclone precipitation, major and minor river fluvial flooding, and pluvial flooding – flash flooding and surface flooding.
The model’s ability to examine both defended and un-defended flood situations enabled RMS to assess where local levees may be overwhelmed. For Harvey, RMS considers that many of the local flood defenses were exceeded in the Houston area where the rainfall was most intense.
The RMS estimate is based on analysis of RMS ensemble footprints, hazard reconstructions of Harvey’s wind field and storm surge, using version 17.0 of the RMS North Atlantic Hurricane Models and RMS U.S. Inland Flood Model.