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Last Updated: Monday, 6 September, 2004, 08:40 GMT 09:40 UK
Hurricane losses may reach $10bn
Waves pound a mobile home park in Jensen Beach, Florida
Frances could cause billions of dollars of damage
Hurricane Frances is set to cause billions of dollars in insured losses in the US, experts predict.

The storm has hit the Florida coast, uprooting trees and cutting power to hundreds of thousands of homes.

As it batters the "Sunshine State", Frances could cause between $2bn and $10bn in insured damages, industry group Risk Management Solutions said.

The destruction comes just three weeks after 26 people were killed by the powerful Hurricane Charley.

In the UK, flights to the area were cancelled over the weekend. Some 6,000 Britons on package holidays, and many more flight-only travellers, have been unable to return home.

The thousands that had been due to fly over the past weekend have been told they can apply for refunds or book alternative flights.

Still recovering

Estimates for the damage done by Hurricane Frances are likely to be lower than first thought as it weakened before coming onshore.

Though now classed as a tropical storm, authorities said it was still dangerous.

Before the storms hit the US, about 2.8 million people had been moved to safety inland, while 70,000 residents and tourists took refuge in shelters.

Some areas in Frances' path have yet to recover from Hurricane Charley, which caused more than $7bn (3.8bn) in insured losses after coming ashore on Florida's south-west coast.

The BBC's Daniel Lak, in Florida, says the combined cost of the clean-up from Hurricanes Frances and Charley will be immense.

Fears that the latest storm would damage Florida's citrus industry saw orange juice prices hit nine-month highs on the commodity markets, while fears that Alabama plantations could be hit also pushed cotton prices higher.

Elsewhere, the domestic airline industry is set to suffer as Americans cut short their travel plans for the long holiday weekend.

Michael Boyd, an aviation consultant at the Boyd Group, said he expected airlines to lose out to the tune of $35m to $40m.

Taking cover

Ahead of Charley, the Wal-Mart chain closed around 75 stores in preparation, and later blamed the event for a decline in August sales.

For retailers and airlines, the timing of the storm could not be worse, coming as it does on Labor Day weekend. The public holiday on Monday makes up one of the four long weekends that usually mean big sales for stores.

However, not all retailers look set to lose out, as shops selling food and home improvement tools could benefit in the aftermath.

DIY chain Home Depot said it had already seen strong demand, as Florida residents prepared for Hurricane Frances to hit by rushing to buy plywood to board up their houses.

Food retailers also reported a surge in sales as Florida residents stocked up on bottled water, tinned food and other essentials.

The worst such natural disaster in the region, Hurricane Andrew, caused damage estimated at $20bn when it struck in 1992, contributing to devastating losses on the Lloyd's of London insurance market.

But analysts say insurers have since limited their exposure to hurricane damage, with the Florida government taking on a bigger role in disaster insurance.




SEE ALSO:
Hurricane Frances pounds Florida
05 Sep 04  |  Americas
Markets brace for fresh hurricane
03 Sep 04  |  Business
In pictures: Hurricane Charley
16 Aug 04  |  In Pictures
US hurricane victims face turmoil
17 Aug 04  |  Americas
Florida begins hurricane clean-up
16 Aug 04  |  Americas



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