TALLAHASSEE – A government program that provides critical replacement protection to property insurers could pay out an estimated $4.6 billion due to hurricane damage Milton and Heleneofficials said Wednesday.

If that preliminary estimate is correct, the Florida Hurricane Catastrophe Fund will have enough cash to cover its share of losses, executives and a financial adviser told members of the Florida Hurricane Catastrophe Fund’s advisory board. The majority of the estimated losses can be attributed to this Hurricane Milton.

Commonly known as the “Cat Fund,” the program provides relatively low-cost reinsurance to property insurers. Carriers must pay losses up to certain amounts, called deductibles, before they can draw on the sovereign wealth fund.

The Cat Fund is estimated to have $7.12 billion in cash this year to cover losses and has access to $3.25 billion in so-called “pre-event” bonds if needed.

“First estimates for Hurricane Helene and Hurricane Milton “With respect to the Cat Fund, the expenses are $4.6 billion, which the Cat Fund can cover with its current available cash resources,” said Chris Spencer, executive director of the State Board of Administration, an agency that includes the Cat Fund belongs.

The preliminary estimate includes $4.5 billion from Milton, which made landfall in Sarasota County on Oct. 9 as a Category 3 storm before spreading across the state as a hurricane. The estimate includes $100 million for Helene, which made landfall in Taylor County on Sept. 26 after causing extensive damage to other coastal communities as it traveled through the Gulf of Mexico.

Property insurers were hit harder by Milton, in part because it landed in a more densely populated area than Helene and because much of Helene’s damage was due to flooding. Property insurers typically do not cover flood damage because homeowners are responsible for purchasing separate flood insurance.

Gina Wilson, executive director of the Cat Fund, said the program does not have an estimate of Hurricane Debby, which hit Taylor County in early August. That’s because Storm Debby likely wasn’t strong enough to trigger Cat Fund refunds to insurers.

Under state law, the Cat Fund has a maximum potential liability of $17 billion. In addition to cash and pre-event bonds, the company could seek financing through so-called “post-event bonds.” The bonds would be paid off through additional fees or tax assessments that would ultimately be passed on to policyholders.

Wilson said Cat Fund officials are prepared to consider the possibility of post-event bonds should Milton make landfall in the Tampa Bay area, which seemed possible before the storm hit Sarasota County.

“Had it been a direct hit on Tampa Bay, the loss might have been much greater,” Wilson said. “The same goes for Helene. If it had been a direct hit in Tallahassee, it would be a different story.”