Apocalypse Now for Natural Disaster Insurance Claims
February 2010 has seen unprecendented natural disasters and as we head full steam towards December 2012, if those Mayan descendents and crusading followers of John's Revelation are to believed, we have only just seen the beginning of the great losses as we plummet into the 'End of Days!Yeah OK! Insurance Blogger prefers predictions backed up with slightly more statistical analysis and insight......
however , a report released this week from Aon Benfield’s Impact forecasting team has predicted that the cost of recent natural disasters is likely to cost both the reinsurance and insurance sector billions.
The capital advisory unit provided the damning verdict in the latest edition of its Monthly Cat Recap report its regular analysis of worldwide catastrophic events. A combination of the Chilean earthquake, Windstorm Xynthia and savage winter conditions across the US and Europe in February has left many in the industry feeling the financial impact.
The magnitude 8.8 earthquake in Chile, the seventh strongest earthquake ever record, has devastated the South American country and has taken the life of at least 795 people. The tragic disaster follows only weeks on from the horrific Haiti earthquake disaster which has sadly now claimed over 200,000 lives.
However, it is the impact of the Chilean earthquake which may effect the tentative recovery of the global economy as the country has far more exposure to risk than the poverty stricken Caribbean island. With more than 1.5 million homes, buildings and other structures affected insured losses alone are set to be in single figure billions of dollars whilst the economic losses are expected to reach tens of billions of dollars. (USD)
There was further suffering in South America with flooding across four regions of Bolivia killing 15 people and more than 100,000 people having to abandon their homes. It is believed that well over than 35,000 homes have been damaged. Also in the continent 20,000 homes have been damaged or destroyed in Peru due severe flooding which also affected Uruguay and Argentina.
In Europe Windstorm Xynthia ravaged Spain, Portugal, France, Belgium and Germany causing damage right across western Europe and leaving close to two million homes without electricity. The report predicts that the insured losses resulting from the storm are expected to be in excess of 1.8 billion dollars (USD)
Meanwhile the heavy rains that soaked the continent were responsible for extensive flood damage in Bulgaria, Turkey and Italy. Greece’s current troubles were also deepened with 20,000 hectares of land flooded and damage to homes and infrastructure likely to cost approximately 10 million dollars (USD). Other areas hit by torrential rain and flooding were Madeira and Spain with reports of further lives being lost in Madeira and extensive property infrastructure damage resulting in reconstruction costs which are likely to approach 1.35 billion dollars.
The US too has also suffered severe winter storms as commentators suggest that the effects of climate change are beginning to take hold. Several key regions including Washington, New Jersey, Baltimore and Philadelphia which resulted in widespread blackouts and disruption to schools, airports, roads and railways. Over 35,000 claims have been filed in the US across February totalling 125 million dollars (USD)
With plenty of insurers posting strong financial profits after the benign hurricane season last year it seems Mother Nature is intent and making herself felt once again – or are we feeling as some would have us believe the first real effects of the climate change?
Either way February 2010 will be a month that will marked in history as a tumultuous and tragic year which has resulted in heavy costs both financial term and also tragically the loss of innocent life.
Labels: claims, Earthquake Insurance, global risks, Hurricanes, natural disasters, reinsurance, storm damage claims
posted by Insurance Blogger @ 3:09 AM
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