* Harvey losses seen well below Katrina and Sandy
* Storm chaos means claims will take time to emerge
* Munich Re predicts increasing storm intensity in future
* Hurricane intensity graphic: http://tmsnrt.rs/2gcckz5 (Rewrites, adds share price details, damage estimate from JPMorgan analyst)
BOSTON/FRANKFURT, Aug 28 (Reuters) - Hurricane Harvey's whipsaw of wind and rain across Houston and the Texas Gulf Coast hurt the shares of U.S. property and casualty insurers on Monday as Wall Street analysts estimated insured losses as high as $20 billion.
That would make it one of the costliest storms in history for U.S. insurers, but could ultimately help insurers and reinsurers to raise rates, some analysts said, after a period of low premiums.
"Our best guess at this point is Harvey could result in $10 billion to $20 billion of industry insured losses, making it one of the top 10 most costly hurricanes to hit the United States," JPMorgan analyst Sarah DeWitt said in a research note on Monday.
Swathes of Houston were underwater on Monday, the effect of Harvey sweeping ashore on Friday as the most powerful hurricane to hit Texas in 50 years. It has since been downgraded to a tropical storm, but more rain is expected to fall on the fourth-largest U.S. city.
Damage caused by flooding is not included in standard homeowners insurance policies and is covered by the U.S. government. However, flood damage to businesses is covered by commercial policies, said DeWitt, which could result in "meaningful losses for the commercial reinsurers and insurers."
JPMorgan's and other estimates are currently well below the $75 billion in insured losses caused by Hurricane Katrina hitting New Orleans in 2005, but are likely to grow.
Shares of Travelers Companies Inc and Allstate Corp , two of the largest homeowners insurers in Texas, fell 2.6 percent and 1.5 percent respectively on the New York Stock Exchange. Shares of Progressive Corp, a large auto insurer in Texas, fell 2.3 percent.
Harvey struck only days before senior insurance executives hold their annual meeting in Monte Carlo to haggle over reinsurance renewals as premiums remain stubbornly low across the industry.
"We think Harvey could help stabilize global reinsurance pricing, but do not expect a major turn in pricing to follow," Kai Pan, an insurance analyst at Morgan Stanley, said in a research note on Monday.
Property and casualty insurance stocks tend to underperform immediately after a catastrophic storm, but often beat the overall market once loss estimates become more accurate and insurers are able to stabilize or raise premium rates.
By contrast, insurance brokerage stocks, such as Marsh & McLennan Cos Inc, tend to rise immediately after a storm because such companies are not exposed to underwriting risk and a rise in premium rates boosts their commission income.
Shares of Marsh & McLennan, which bought one of the largest insurance brokerages in Texas in 2015, closed up 0.5 percent on Monday.
Houston is facing worsening flooding in the coming days as the storm dumps more rain on the city, swelling rivers to record levels and forcing federal engineers on Monday to release water from reservoirs in an effort to control the rushing currents.
Swiss Re said it is too early to gauge the full impact.
There are so many areas that have been hit by devastating winds and now the massive flooding, and insurance adjusters are having to wait for first responders to simply check on the safety and welfare of citizens," said Mark Hanna of the Insurance Council of Texas.
Claims are expected to accelerate once Texas residents get their bearings.
"We have just over 2,000 claims across all lines of business," said Farmers Insurance Group spokesman Trent Frager. "While that may sound low, residents who are evacuated haven't (yet) been able to assess and report damage for claims handling."
(Additional reporting by John O'Donnell in Frankfurt, Paul Arnold in Zurich and Aparajita Saxena in Bangalaru; Editing by David Goodman and Bill Rigby)