Hawaii has been inundated by 19 inches of rain overnight as Hurricane Lane approached the southwest tip of the state’s Big Island bringing flooding and landslides.

The storm was downgraded to a Category 3 late yesterday but winds were at 120 mph with gusts of up to 160 mph.

America’s National Oceanic and Atmospheric Administration centre currently expects the storm to track northwest over the weekend, skirting the islands of Hawaii, without making direct landfall.

It is expected to weaken over the course of Friday and into Saturday morning when it is on track to be downgraded to a Category 2 as it passes to the southwest of Maui.

By Saturday afternoon it is forecast to weaken further to a Category 1 before tracking west away from Hawaii and across the the Pacific.

An estimate from property provider CoreLogic said the storm, threatens almost 50,000 homes with a reconstruction cost value (RCV) of around $8bn. However, actual losses are now expected to be relatively modest.

US giant State Farm dominates almost a third of the $383.6mn homeowner’s market in Hawaii, according to data from rating agency AM Best.

Heritage is the next largest carrier in the state after its $134mn acquisition of Hawaii’s Zephyr, which closed in 2016.

The Insurance Information Institute (III)  has drawn a comparison between Hurricane Lane and Hurricane Iniki, which battered the Hawaiian islands in 1992. In today’s dollars the total cost of the storm would have been around $2.8bn.

The Institute said homeowners and rental policies in Hawaii tend to provide cover for almost all standard perils such as fire and liability but exclude hurricanes.

“In Hawaii, homeowners and renters generally purchase hurricane and flood insurance policies separately to protect their property from those specific natural disasters, and to supplement their homeowners and renters insurance policies,” the III explained.

Most hurricane insurance policies have a “72 hour clause”, which means that once a hurricane watch or warning is issued by the National Weather Service, damage sustained over the following three days would be covered by a hurricane policy, according to Hawaii’s Department of Commerce & Consumer Affairs, Insurance Division.

Comprehensive auto policies cover wind, hurricane and flood-caused property damage to vehicles. And business insurance policies, which include interruption cover may come into play given Hawaii’s significant tourism industry, the III said.