14 November 2025
The full economic toll of Hurricane Melissa on Jamaica is rapidly escalating, with new modelling suggesting losses could exceed US$20bn, a value higher than the country’s entire 2024 economic output, even as international aid, insurance payouts and private relief efforts intensify.
Moody’s Event Response Services now estimates that overall economic losses from the Category 5 storm may surpass the equivalent of Jamaica’s 2024 GDP, far above the government’s initial damage estimate of US$6bn to US$7bn.
The modelling captures property destruction, severe business interruption, widespread infrastructure damage and non-modelled impacts such as extended shutdowns and flooding, signalling a systemic economic shock rather than a short-term setback.
Private insurance losses from Melissa across Jamaica and other affected territories, including The Bahamas, Haiti and the Turks and Caicos Islands, are projected between US$3bn and US$5bn, with a central estimate of US$3.5bn.
These losses are driven largely by wind damage to hotels, resorts and other commercial properties, with business interruption claims expected to be substantial. Verisk estimates insured losses in Jamaica alone at between US$2.2bn and US$4.2bn.
Yet the protection gap is stark. Only about 20% of Jamaican homes are insured and an estimated 95% of insured properties are underinsured, according to industry data cited by Moody’s, leaving tens of thousands of families exposed. “Most insured buildings are well-built… In contrast, uninsured residential buildings largely exhibit less stringent build quality… As a result, as Melissa’s catastrophic winds tracked across the island, immense damage was caused to several communities,” said Moody’s Managing Director of Modelling and Analytics Raj Vojjala.
The human cost is also mounting. At least 32 people have been confirmed dead in Jamaica, with dozens more killed elsewhere in the region. “All of Jamaica is going through this period of mourning and this period of pain,” said Education Minister Dana Morris Dixon. Entire communities in western parishes remain cut off as roads, bridges, electricity and telecommunications networks lie crippled. UN assessments indicate more than 1.5mn Jamaicans have been affected, over 100,000 housing structures damaged, and nearly 36,000 people in urgent need of food assistance.
Despite the devastation, Jamaica’s disaster risk financing strategy is beginning to unlock critical resources. The World Bank catastrophe bond will pay its full US$150mn trigger, while the Caribbean Catastrophe Risk Insurance Facility is set to deliver a record US$91.9mn payout linked to excess rainfall and high winds. Together with contingent credit from development partners, these instruments amount to roughly 4% of GDP, providing essential short-term fiscal space even as overall losses climb.
The US has pledged a total of US$22mn in humanitarian assistance so far, alongside military and civilian assets airlifting supplies into isolated communities. “We were able to bring in heavy lift helicopters… they’ve moved more than half a million pounds of life-saving aid,” said US Under Secretary Jeremy Lewin, who stressed that Washington would remain engaged “for every stage of this recovery”. Prime Minister Andrew Holness hailed the US as one of the earliest and most decisive responders, particularly in reaching marooned communities.
The global cruise industry has also rallied. Carnival Corporation, Royal Caribbean Group and Disney Cruise Line have each committed US$1mn, while Norwegian Cruise Line Holdings has pledged up to US$100,000 plus matched donations, bringing total announced cruise-sector support to more than US$3mn. Cruise vessels and cargo ships have doubled as relief platforms, delivering pallets of water, medical supplies and essential goods to Ocho Rios and other key ports as operations resume.
Jamaica’s aviation sector, crucial for both tourism and logistics, has shown early signs of resilience, with over 1,100 flights recorded in the 13 days following the storm as airports facilitated incoming aid, cargo and outbound travellers. This rapid reopening underscores both the urgency of the relief effort and the determination to stabilise a core pillar of the economy.
Holness has warned that Melissa’s impact will strain public finances and require temporary suspension of fiscal rules. But he has also framed the disaster as a turning point. “Every repaired bridge, re-roofed home and rebuilt road must be designed for the storms of tomorrow, not the storms of yesterday,” he said, vowing to harden infrastructure, modernise the grid and leverage support from partners to “build back stronger and wiser”.
For now, as debris is cleared and aid corridors expand by air, sea and land, Jamaica stands at the intersection of immense loss and unprecedented mobilisation, a stark illustration of climate vulnerability, but also of how preparedness, insurance and international solidarity can shape the path from catastrophe toward recovery.
Source: Caribbean Insight – Volume 47, Issue 22