Though the Texas Department of Insurance had initially estimated total claim payouts of around $20 billion, analysts now project it to be anywhere in the range of $1 billion to $5 billion.
Due to their higher regional presence in the affected areas, Travelers (TRV) and Chubb (CB) are expected to be the worst hit. Other firms that will possibly see ripple effects include Allstate (ALL), American International Group (AIG) and Bermuda-based Arch Capital (ACGL).
Warren Buffett-led Berkshire Hathaway (BRK) is also likely to be hit due to its exposure to the insurance sector.
Insurance, construction firms to be hit worst by Hurricane Florence
These companies might feel the pinch in the short-term, but once the disaster is behind us, remember the money is coming back. As the first-hand experience of such a disaster encourages more people to cover their valuables, demand for home and vehicle insurance generally surges post calamities, sending rates higher.
Separately, the National Flood Insurance Program (NFIP) is likely to absorb most of the damages caused by Hurricane Florence, cutting down on the burden on these companies.