RMS predicts Rita damages of US$4-7 billion

Risk Management Solutions (RMS) recently estimated insured losses from Hurricane Rita are likely to range between $4 billion and $7 billion, based on current information on landfall location and wind speeds.”Hurricane Rita is comparable to last year’s Charley in that its damage is spread across a low population density region of agricultural and fishing-related industries,” RMS meteorologist Kyle Beatty said. “There is also notable damage to offshore platforms, refineries and by-products industries of petroleum manufacturing.”RMS based its estimate on the following storm-related factors:- $3 billion to $5 billion in onshore damage resulting from wind, storm surge, and rainfall-related flood hazards. RMS’ modeling of wind impacts includes both damage to buildings and notable tree-fall damages. The estimate also includes expected demand surge effects, resulting from the inflation of material and labor costs in the region in the aftermath of Hurricanes Katrina and Rita. – $1 billion to $2 billion in offshore platform damage and loss of production.- RMS’s preliminary estimate excludes the New Orleans flooding situation that once again presented itself over the weekend. Hurricane Rita made landfall as a Category 3 storm on Sept. 24 on the extreme southwest coast of Louisiana between Sabine Pass and Johnson’s Bayou.Hurricane force winds extended 85 miles from the center. An instrumented tower in Port Arthur run by the Florida Coastal Monitoring Program reported sustained winds of 91 mph with a gust to 116 mph as Rita came onshore. Widespread power outages struck the entire region.RMS’ aerial reconnaissance team has already begun a two-day survey of the region and RMS will continue to monitor Rita’s impact throughout the week. The company has representatives available for comment in London and California.