Hurricane Michael, one of the strongest tropical systems to make landfall on the mainland U.S., may turn out to be the costliest catastrophe for U.S. property and casualty insurers in 2018.

Michael slammed into the Florida Panhandle on Oct. 10 as a Category 4 hurricane, leaving devastation in its wake. Estimates from modeling firms show that the bill for the disaster could run as high as $10 billion for insurance companies.

Wind and storm surge claims are expected to cost insurers between $6 billion and $10 billion, AIR Worldwide said Oct. 15. Aon's Impact Forecasting in its October Global Catastrophe Recap said total economic damage was likely to amount to more than $15 billion. Public and private insurers, including federal government flood and crop programs, were expected to shoulder more than $8 billion of that total, Impact Forecasting added.

FedNat Holding Co. was the insurer to release Michael-related loss estimates, saying Oct. 15 that it expected gross losses of nearly $275 million but that losses net of reinsurance would not exceed $20 million for unit Federated National Insurance Co. and $3 million for Monarch National Insurance Co.

Berkshire Hathaway Inc. could incur the biggest loss based on disclosures to date, having estimated that its fourth-quarter costs would fall in a range of $350 million to $550 million. "The timing and amount of catastrophe losses can produce significant volatility in our periodic underwriting results, particularly with respect to our reinsurance businesses," it reported.

American International Group Inc. on Oct. 18 released an initial loss estimate related to Hurricane Michael of between $300 million and $500 million, while Munich Re Co. forecast combined losses of €350 million from Michael and Typhoon Trami, which hit Japan.

Several Florida homeowners insurers are expected to see a large negative impact on their fourth-quarter earnings. Universal Insurance Holdings Inc. anticipates net pretax losses of $35 million, while Zurich Insurance Group AG expects its losses to total $175 million. Market share data indicated that Zurich was the biggest underwriter of mobile home insurance in six Florida counties hard-hit by Michael, while Universal was the fourth-largest homeowners underwriter in those counties.

For additional coverage of recent catastrophes, click here to access the "Storm surge" collection of articles.