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Hurricane Michael insurance claims pouring in

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Claims activity from Hurricane Michael, which came ashore Oct. 10 as a Category 4 storm, is in full swing almost two weeks later, industry sources said.

Michael was markedly different than predecessor Florence, which soaked the East Coast in September.

“Florence was much like Harvey, a slow-moving storm with a large geographical footprint,” said Gary Marchitello, New York-based head of property broking for Willis Towers Watson PLC. “Michael was certainly a very, very intense storm, but had a smaller footprint, and was also very, very fast-moving.

Mr. Marchitello called the storms “a study in contrast.”

Michael “did move through very quickly,” said Dan Daniel, executive vice president of centralized services for Sedgwick Claims Management Services Inc. in Atlanta. “It was very different from Florence and even from Harvey the year before, which were slow-spinning storms that dropped a lot of rain.”

Now almost two weeks after Hurricane Michael’s landfall, claims activity is robust.

“We are in the midst of handling a variety of claims associated with Hurricane Michael, and adjusters continue to be deployed,” Kenneth Tolson, U.S. president of claims solutions for Crawford & Co., said in an email to Business Insurance. “It’s difficult to say how many homes and businesses have been affected at this stage, as we are still receiving new claims daily.”

During hurricanes Harvey, Irma and Maria in the third quarter 2017, “more than half of claims were reported in the first week to 10 days for each of these events,” Mr. Daniel said.

“It feels like the claims submissions are slowing down,” Mr. Daniel said. “I get the sense that we’ve probably reached the peak of intake, and the volume of intake will slow down.”

Damages also turned on Michael’s path through the Florida panhandle, the sources said.

“I think demographics also matter greatly as well,” Mr. Marchitello said. “Certainly in the case of Michael, it seems like the bulk of the damage is residential properties as opposed to commercial.”

“I don’t think that has to do with the characteristics of the storm itself,” Mr. Marchitello said. “It’s simply a matter of where it hit.”

“It hit in an area with many vacation homes but not a heavy concentration in terms of population,” Mr. Daniel said. “You’ve got smaller populations, so you’ve got smaller businesses,” such as a gas station losing its awning to wind, he said. “Everything in the panhandle got hit hard.”

The most recent insured damage estimates came Friday from Risk Management Services Inc., which put insured losses at between $6.8 billion and $10 billion, with wind accounting for the bulk of the damage at $6.4 billion to $8.7 billion and storm surge for $400 million to $1.3 billion.

“Wind has been the devastating force to areas impacted by Michael, and the damage spans Florida, Georgia and Alabama,” Mr. Tolson said.

The RMS figures include “insured losses associated with wind and storm surge damage across Florida, Georgia, and other parts of the Southeast and Mid-Atlantic regions, including losses to the National Flood Insurance Program,” RMS said in its statement.

The estimate includes property damage and business interruption across residential, commercial, industrial and automobile lines of business, though RMS expects the majority of insured losses to impact residential lines, the statement said.

Access to the affected areas has been uneven, according to reports.

“With Harvey and Florence, it was such a long-developing loss scenario, you really couldn’t get in there and assess the damage for several weeks,” Mr. Marchitello said. With fast-moving Michael, the initial macrodamage assessments were performed more quickly, he said.

“Even though it moved through the panhandle quickly, the devastation left behind in such a small area really did wreak some havoc with the access and the roads going in and out,” Mr. Daniel said.

“Significant damage to infrastructure has delayed both our access to certain areas and the claim reporting process. It’s difficult to say how many homes and businesses have been affected at this stage, as we are still receiving new claims daily,” Mr. Tolson said.

Recruiting efforts ensured an ample supply of adjusters for Michael claims.

“We literally started planning for this storm and others this season in terms of recruiting after last year’s storms and after last year’s lessons learned,” Mr. Daniel said.

“One of the major takeaways from last year in terms of the people piece of the puzzle had to do with recruiting and training new talent,” Mr. Daniel said, adding Sedgwick has trained more than 100 new people since last year’s storms.