Irma is one of three hurricanes churning in the Atlantic Basin. Jose, the third major hurricane of the 2017 season with top winds of 150 miles per hour, is forecast to turn northeast and miss the U.S. In the Gulf of Mexico, Katia strengthened as it moved slowly toward Veracruz, Mexico, where it’s forecast to come ashore early Saturday. The country was also struck by a powerful earthquake on Friday, shaking buildings in the capital and triggering a tsunami warning.

Hurricane-force winds extend for 140 miles

Irma’s hurricane-force winds now extend for 140 miles, creating a danger zone that would extend from West Palm Beach on the Atlantic coast to Fort Myers on the Gulf of Mexico. That’s creating an “insurance industry nightmare” as every county in the state could experience damaged roofs and power outages so vast it overwhelms utility repair efforts, said Chuck Watson, a Savannah, Georgia-based disaster modeler with Enki Research.

Damages could easily top $135 billion in Florida, with other economic losses pushing the price tag as high as $200 billion, Watson said. Preliminary estimates show losses across the Caribbean nearing $5 billion, Josh Darr, lead meteorologist with insurance broker JLT Re Ltd. wrote in his blog Friday.

Total losses from Katrina reached $160 billion in 2017 dollars after it slammed into New Orleans in 2005.

'Throw a wrench into the insurance industry'

“Wind damage is totally going to throw a wrench into the insurance industry,” Watson said. “You are talking about companies failing.”

Insurers including XL Group Ltd. and Everest Re Group Ltd. recovered some ground after falling 5.1% and 6.8T respectively Thursday. The storm may knock out power to more than 3 million homes and businesses, curb natural gas demand in one of the largest U.S. markets and threaten $1.2 billion worth of crops in Florida — the nation’s top grower of fresh tomatoes, oranges, green beans, cucumbers, squash and sugarcane.

Irma was 405 miles southeast of Miami and is forecast to approach the north coast of Cuba and the central Bahamas before striking southern Florida Sunday morning, the hurricane center said.

Irma comes just two weeks after Hurricane Harvey smashed ashore in Texas, knocking offline almost a quarter of U.S. oil refining capacity and causing widespread power outages and flooding.

In other storm news

• Orange juice futures rallied to the highest level since May.
• Airlines have canceled thousands of flights.
• Miami’s financial district was rapidly emptying out before landfall.
• The storm threatens to turn years of strong returns for hedge funds and other catastrophe-bond buyers into losses almost overnight and may affect how much money bondholders receive on their Puerto Rico Electric Power Authority bonds.
• Irma’s chemical fallout could be worse than Harvey’s as Florida plants are filled with potentially explosive material.

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