After a run through the Bahamas, Hurricane Irene is tracking northwest throughout the course of the Thursday, putting coastal North Carolina in the storm’s sites.
Fortunately for residents of the region, much of the storm’s fury may dissipate prior to it making landfall, notes Emily Paterson, associate manager of cat response at
“Model intensity guidance is generally showing Irene’s intensity to reach a maximum over the next 24 hours as a category 4 storm, as it tracks towards North Carolina over SSTs in the region of around 29C, beyond which the system will begin to weaken,” Paterson said. “From 36 to 48 hours, model guidance is suggesting a significant increase in vertical wind shear causing a decrease in intensity, but due to the large circulation of Irene, slow weakening is expected.”
While the ultimate impact of the storm remains to be seen, the economic implications for the state and the insurance industry are already clear. The North Carolina Insurance Underwriting Association, also known as the Beach Plan, provides policies for properties located in the state’s 18 coastal counties. In 2009, the state passed legislation intended to make insurance more affordable for homeowners and businesses in high-risk coastal areas. The law placed an absolute cap on insurers’ post-storm assessments at $1 billion, and mandates that commercial and residential property insurance policyholders throughout the state would pay a surcharge of up to 10 percent of premium per year to cover any amount above $1 billion.
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