Earthquakes, storms, floods slam insurers: SwissRe

9th September 2011, Comments 0 comments

Earthquakes in Japan and New Zealand, storms in the United States and floods in Brazil have caused widespread death and disrupted the lives of millions, but they are also set to turn 2011 into the second worst on record for insurers, reinsurer SwissRe said on Friday.

The costs incurred by global insurers from natural and man-made disasters reached $70 billion during the first half of 2011, more than twice the figure of $29 billion in the first half of 2010, SwissRe said.

"In terms of catastrophe claims, 2011 is already the second costliest year in history for the insurance industry," SwissRe chief economist Thomas Hess said.

The company gave the details in a statement on the firm's preliminary loss estimate for the first six months of 2011 which happens to coincide with the sixth-month anniversary of the Japanese disaster and comes on the eve of the rugby world cup competition in New Zealand. Several matches have had to be switched away from quake-hit Christchurch.

The worst year so far for insurance firms was 2005, when Hurricane Katrina, Wilma and Rita caused more than $90 billion in combined loss, SwissRe said.

Total insured loss in that year was $120 billion, including claims for hurricanes and other disasters, it said.

SwissRe also said that the tsunami and earthquake in Japan, which killed more than 26,000 people and caused nuclear contamination, coupled with the February earthquake in Christchurch would cost insurers upwards of $40 billion, making 2011 already the second most expensive year for earthquakes.

This was despite the magnitude of the January 2010 earthquake in Haiti, which flattened the capital Port-au-Prince and killed more than 280,000 people during the same period a year ago, the company said.

The casualty figures were provided in the SwissRe statement.

"Given the many people who died in Japan and the sad experiences in New Zealand, 2011 will certainly go down as another year of very tragic earthquakes," Hess said.

He also warned that as the US hurricane season was still not over, and the winter storms in Europe had not yet begun, the rest of the year had "the potential to bring figures for the full year even closer to the record claims of $12 billion experience in 2005."

SwissRe said that total losses for both the insured and uninsured during the first six months of 2011 totalled $278 billion, with 26,000 victims, mostly in Japan following the March tsunami and earthquake.

During the same period in 2010, however, total losses reached $166 billion.

The March 11 Tohoku earthquake ranks as the most expensive natural catastrophe for insurers this year, generating $30 billion in claims, while total losses are evaluated at 210 billion, it said.

The February 22 earthquake in Christchurch ranked second, with $9.0-12.0 billion in claims, followed by the April storms and tornadoes in Alabama and surrounding states, with insured loss estimated at $6.6 billion, it said.

Floods in Brazil in January took more than 900 lives.

The floods in Australia in December 2010 to January 2011 caused insured losses of more than $2.8 billion, it said.

Man-made disasters caused more than $3.0 billion in insured losses, it added, without giving any details.

© 2011 AFP

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