Filed Under:Markets, Commercial Lines

New Zealand Quake Dominates A Busy Global Catastrophe Month

NU Online News Service, March  4, 12:31 p.m. EST

Top Catastrophes, February 2011Aon Benfield said assessing insured losses from the latest Christchurch, New Zealand earthquake will be “extremely difficult and complex” because of an earlier quake, known as the Darfield earthquake, that struck the same region in September 2010.

“The people of New Zealand were still coming to terms with the widespread damage caused by last year’s Darfield earthquake,” said Steve Jakubowski, president of Impact Forecasting, a part of Aon Benfield, which publishes a monthly catastrophe report. The second quake “has proved even more devastating both in terms of extensive structural damage and its impact on human lives, due to its shallower depth and epicenter located much closer to Christchurch,” he added.

The catastrophe report said the New Zealand Earthquake Commission (EQC) has already received more than 31,500 insurance claims. That number is expected to increase. The EQC provides coverage of up to NZ$100,000 (US$73,385) for residential owners who purchase fire insurance.

Aon Benfield said the New Zealand government puts the economic impact of the temblor at NZ$10 billion to $15 billion (US$7.5 billion to $11.3 billion). More than 160 people died, thousands were injured, and others remain missing due to the earthquake. Catastrophe modeler AIR Worldwide said losses from the quake are expected to be between NZ$5 billion (US$3.5 billion) and NZ$11.5 billion (US$8 billion). The estimate includes damage to property, contents and direct business-interruption losses.

Though the magnitude 6.3 earthquake on Feb. 22 dominated the month of February, other events in the United States and Australia caused big losses.

Cyclone Yasi in Australia early in the month is estimated to have caused about $800 million in economic damages, reported Aon Benfield. The Insurance Council of Australia said more than $510 million has been paid to policyholders, with more than 30,600 claims filed.

AIR said insured losses from Cyclone Yasi in Australia will be between $354 million and $1.5 billion.

Aon Benfield said insurers have received more than 80,000 claims related to a giant winter storm that affected more than half the country in early February. Losses have topped 400 million, according to the report.

AIR estimates insured losses from the massive winter storm to be between $790 million and $1.4 billion.

Additionally, Aon Benfield said structural damage and business-interruption claims were generated from winter weather in Canada and snow also damaged areas of South Korea, with an estimated economic impact of $69.6 million.

February also included flooding in the Philippines, a cyclone in Africa, and deaths due to severe cold weather in Europe, Aon Benfield said.

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