Despite pounding parts of the East Coast, Hurricane Nicole will not hit Florida's insurance market as hard as Hurricane Ian.

CoreLogic, a property-information and analytics firm, released an early estimate Friday that said Nicole's privately insured losses will be less than $750 million. The modeled estimate represented "gross" losses, which typically means insurance carriers would not face the full amount because they are partially shielded by backup coverage known as reinsurance.

Nicole made landfall early Thursday south of Vero Beach as a Category 1 storm before moving up the state as a tropical storm. The Category 4 Hurricane Ian, which made landfall Sept. 28 in Southwest Florida before crossing the state, has been projected to cause tens of billions of dollars in insurance losses.

As of Wednesday, the state Office of Insurance Regulation said $8.7 billion in estimated insured losses had been reported from Ian, a number that has steadily increased. That number includes property-insurance claims and other types of claims, such as for auto damage.

While Nicole won't cause as large of losses as Ian, Fitch Ratings on Friday released an analysis that pointed to the combination of the storms continuing to build pressure on Florida's troubled property-insurance system.

The ratings agency's analysis focused on the state-backed Citizens Property Insurance Corp. and the Florida Hurricane Catastrophe Fund, another state program that provides relatively low-cost reinsurance to carriers. Fitch said both programs have enough cash to meet their obligations from Ian and Nicole but cited potential longer-term effects.

If needed, both programs have the power to collect "assessments," extra charges on insurance policyholders throughout the state, to meet obligations. They also can issue bonds.

"Citizens and FHCF [the Florida Hurricane Catastrophe Fund] are obligated to levy emergency assessments or issue bonds if claims and reimbursements exceed liquid resources, including reserves and premium collections, until obligations are fully met," Fitch said in the analysis posted on its website. "Even if FHCF and Citizens do not need to tap the market this year, they will have exhausted much of their liquidity, leaving them more likely to have to borrow in the future to rebuild liquidity."

Citizens has estimated it will receive about 100,000 claims from Hurricane Ian. The Florida Hurricane Catastrophe Fund estimated in late October it would have about $10 billion in losses from Ian, after going into the hurricane season with $15.8 billion in cash and proceeds of what are known as "pre-event" bonds.

Citizens, which was created as an insurer of last resort, has seen its policy count more than double during the past two years as private insurers have dropped customers and, in some cases, gone insolvent because of financial problems. Citizens had about 1.12 million policies as of Nov. 4.

Gov. Ron DeSantis called a special legislative session in May to try to shore up the insurance system. Lawmakers took steps including providing $2 billion in reinsurance to carriers, but problems have persisted.

The Legislature is expected to hold another special session in December that will include addressing property insurance. Incoming House Speaker Paul Renner, R-Palm Coast, told City & State Florida, a sister publication of The News Service of Florida, that he expects a "pretty robust special session on property insurance."

Renner said last week that a priority will be to "provide stability and capacity in the market, which is frankly at risk at this point. We don't want that to happen where we have people who can only get Citizens policies. We've seen the dramatic rise in Citizens. So addressing the stability of the market and sufficient capacity is job one for the special session. But really 1B, if you will, is to make sure we begin the process of taking steps that will bring down the cost of insurance."

Renner, who will formally take over as House speaker Nov. 22, cautioned that lower costs will "not happen overnight."

"If we took the magic wand and everything we didn't get done during the prior special session got done that people might agree as optimal to reform our market to make it healthy, it still would not overnight bring down the cost of insurance premiums," Renner told City & State Florida. "However, once we do rebuild that capacity, once we do have those additional reforms in place, then I'm hopeful that over time we'll see those rates decline, and hopefully at some point actually see some reversal of the increases so people can get a break on their insurance premiums."

Meanwhile, property owners in places such as Volusia County are grappling with damage from Hurricane Nicole. The storm and resulting erosion caused damage to beachfront homes, condominium buildings and hotels, with some structures crumbling into the ocean.

The Volusia County property appraiser issued an initial assessment of more than $481 million in damage from Nicole, according to a county website. It likely will take a long period to determine how much of the damage is covered by private insurance.

Jim Saunders reports for the News Service of Florida.

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