Today In Data: Devastation From 2017 Hurricanes

Natural disasters are horrifically destructive events, and Hurricanes Harvey and Irma were no exception in terms of economic loss. With some affected areas experiencing total devastation and others still under water, the question has shifted to how the insurance industry will respond to the influx of flood insurance claims.

The problem, according to Drew Edwards, CEO of Ingo Money, is that the insurance industry as it exists today is not geared for speed when it comes to making claims payments to insured clients. The default payment method of choice is the antiquated paper check, which takes a long time to process and mail, and then a few days to clear once it makes into the bank account of the insured. That’s assuming there’s still a mailbox where that check can be delivered and an open bank branch where it can be deposited.

“What is so interesting is we have been talking to insurance companies now for several years,” added Cecilia Frew, senior vice president and head of U.S. Push Payments for Visa. “Sometimes it takes a crisis to get people to move. We’ve been working with companies in this space — particularly Allstate, which actually launched in-the-field push disbursements to cards during this event. That has been so successful, and now we’re talking to a number of major players about getting something similar up and running.”

The industry has been looking to FinTech contributions, among other ways to innovate, including implementing push payments for more rapid distribution of funds, but a lot of funds will need to be disbursed.

Here are the numbers:

$290 billion | AccuWeather estimation of total economic losses attributed to destruction from Hurricanes Harvey and Irma

$250 billion | Approximate damage associated with Hurricane Harvey

$75 billion | Estimated flood-related losses resulting from the recent hurricanes

$15 billion | Total flood insurance losses generated by Hurricane Katrina

$15 billion | Amount included in the disaster relief bill signed by President Trump

65 percent | Number of homes in the Florida Keys that suffered major damage from Hurricane Irma

$6.50 | Average amount it could cost an insurance company to send an insurance check