NU Online News Service, March 23, 2:43 p.m.EST

Chilean earthquake insurance claims from the energy industryshould not exceed $350 million, according to an energy claimsspecialist with Marsh insurance brokerage.

The estimate, which followed a review of expected claims, doesnot include any future contingent business interruption claims,Marsh said. The relatively low level of claims means rates for thesector should not be affected, according to the brokerage.

Shortly after the 8.8 magnitude earthquake in Chile on Feb. 27,Marsh said it sent in claims specialists from around the world tosupport not only its local clients, but also international clientswith interests in Chile.

Given the predicted escalating economic costs, internationalenergy insurers would expect to see significant losses from theearthquake. However, despite the significant mining, power and oilprocessing infrastructure in Chile, Marsh said its researchsuggests that companies in this sector have been less affected thanexpected.

Martin Clark, head of Energy Claims at Marsh, said in astatement that, "Our first priority is to provide our clients withoperations in Chile with the highest levels of service, ensuringthey have access to the best loss adjusters, that insurer paymentsare made rapidly, and that the process allows our clients to carryout reinstatement work as quickly as possible. Our team on theground is making sure this happens."

Jim Pierce, chairman of Marsh's Global Energy Practice, added,"Marsh's estimate of an energy loss in the region of $350 millionmeans that losses from the Chilean earthquake will not change thecurrent softening trend in the global energy insurance market.

"However, we expect that insurers will want to re-examinecompanies' risk management preparedness for natural catastrophes.There will also be renewed pressure from them on naturalcatastrophe limits of liability."