Moody’s credit rating agency said the potential impact of Hurricane Beryl on property and casualty insurers would be easily manageable.

Commenting on the sector, Moody’s said: “It will take some time to determine the extent and distribution of insured damages. However, we expect that the losses incurred by insurers as a result of Hurricane Beryl will be low and will be easily absorbed by their earnings.”

Meanwhile, the credit rating agency noted that State Farm, Allstate and USAA (United Auto Service Association) are the homeowners insurers expected to be most affected, based on the size of their premiums in Texas.

“Commercial property insurers are also likely to suffer some losses,” the report said. “The major national carriers have sufficient capacity to withstand larger storms based on their careful monitoring of coastal exposure, geographic diversification, high-quality reinsurance protection, and strong capital bases.”

The top commercial property insurance companies in Texas, according to Moody’s ratings, are Shope, Berkshire, and Sompo.

“Primary insurers in the U.S. have retained a higher proportion of catastrophe risk in recent years (particularly in low-yield periods) as reinsurers have raised rates, attachment points, and withdrawn aggregate coverage,” the company added. “We expect primary insurers to retain most of the losses from Hurricane Beryl.”

The Texas Storm Insurance Association (TWIA), the state’s last insurance company, will cover losses along the Texas coast. TWIA policies provide coverage for property damage caused directly by wind and hail but do not cover damage caused by flooding and storm surges.

“As of April 30, 2024, TWIA had more than a quarter million policies in force with more than $100 billion in insured exposure. TWIA’s total payout capacity is approximately $6.5 billion, which it estimates would cover a once-in-100-year hurricane, an event more severe than Hurricane Beryl.”

Hurricane Beryl made landfall near Matagorda Bay, Texas on July 8 as a Category 1 hurricane after making landfall earlier in the month as a major Category 4 hurricane over Carriacou Island, Grenada.

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