Hurricane Beta swept across the Central American countries of Nicaragua and Honduras at 135kmh yesterday, rapidly degrading into a tropical storm as it dumped 38cm of rain and then headed out into the Pacific Ocean.

Beta was the 13th severe weather event to batter the region in the past few months. 

US insurers are just thankful it didn’t hit the US, where assessment agency Risk Management Solutions says the insured losses from Hurricane Wilma, which hit Florida on October 27, will be in the range of $US8-12 billion ($10.6-16 billion). Insured losses from damage incurred in Mexico from Hurricane Wilma have not yet been assessed. This estimate is slightly higher than estimates from French catastrophe modelling agency Eqecat.

The insurers are already reeling from the financial impact of insured losses from cyclones Katrina and Rita, whose combined insured losses are now estimated at as much as $US50 billion ($66.8 billion).

Cyclone Wilma may have been the last straw for many insurers, which are expected to begin reducing their exposures to the most affected US coastal states. Ratings agency AM Best has warned that some smaller insurers could face difficulties meeting claims.

Robert Hartwig (pictured), Senior Vice President and Chief Economist at the Insurance Information Institute, says insurers will be moving quickly to re-evaluate their exposures in the southern coastal states to avoid any negative impact on their credit ratings.

Major insurers like Allstate and Nationwide stopped writing personal lines business in Florida last year, and Allstate has now announced it will reduce its exposures in the gulf states after claims from Katrina and Rita passed $US1.55 billion ($2 billion).