Shares in Florida home insurers such as Heritage Insurance Holdings (HRTG.N) tumbled on Tuesday as investors braced for losses as Hurricane Irma appeared set to hit the state on Saturday.

Shares in Heritage hit record lows and were last down 15.0 per cent at US$9.58 with trading volume 2.1 times its 10-day moving average. Universal Insurance Holdings Inc (UVE.N) shares tumbled 15.2 and were on track for their biggest one-day percentage drop since November 2015.

Irma strengthened into a highly dangerous Category 5 storm, with winds of 157 mph or higher, on Tuesday as it barreled toward the Caribbean and the southern United States, threatening deadly winds, storm surges and flooding.

"If Irma continues its current path it will create significant insured damage," said Sandler O'Neill analyst Paul Newsome. "It's quite easy for them to wipe out all their earnings for the year."

Shares in HCI Group (HCI.N) were down 13.5 per cent at US$33.45, hitting their lowest since December, with trading volume 3.9 times the 10-day moving average.

Shares in United Insurance Holdings (UIHC.O) were down 9.4 per cent, hitting their lowest point since February, with trading volume 3.4 times the 10-day moving average.

Larger insurance companies with a broader geographic exposure were also down on Tuesday after tumbling last week on expectations of massive losses from Hurricane Harvey, which devastated parts of Texas and Louisiana last week. 

Travelers Co (TRV.N) was down 1.9 per cent after a 5 per cent drop last week and Progressive Corp (PGR.N) was down 2.0 per cent after last week's 5.7 per cent drop, while Chubb Ltd (CB.N) fell 1 per cent.

Another big hurricane in the same year "adds another level of financial losses even for the big companies with enormous capital bases," said Newsome.

A second hurricane "strains the system" as insurers will have a harder time getting enough people to do loss adjustments in order to settle claims as quickly as possible, he said.