Losses seen "manageable" for firms - 13 WTHR Indianapolis

Fitch Ratings says it expects losses from Hurricane Isaac to be significant but "manageable" for insurance companies in the U.S. as well as for the international reinsurance industry.

The rating agency says estimates of property losses from Isaac range from $500 million to $2 billion. The slow-moving storm, which made landfall on Aug. 28, brought more than two days of heavy wind and flooding to Louisiana and Mississippi. Thousands of flood insurance claims are being filed.

Homeowners' insurance policies generally don't cover losses from flooding, though many commercial policies do.

If losses from Isaac come in within the expected range, Fitch says primary insurers will bear most of the loss, as opposed to reinsurance companies.

Reinsurance companies, most of which are based outside the U.S., sell insurance to primary insurers to spread risk. The chances of reinsurance companies having to absorb losses increases as the toll of actual hurricane losses rises.

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