NU Online News Service, Sept. 15, 3:51 p.m. EDT

Insured losses from the Christchurch, New Zealand, earthquake could reach as much as $2.5 billion, according to a catastrophe modeling firm.

Risk Management Solutions (RMS) said it expects insured losses of between $1.5 billion and $2.5 billion from the earthquake in New Zealand earlier this month.

The catastrophe modeler said about two-thirds of the total insured loss from the Sept. 4 earthquake will be paid by the country's Earthquake Commission, which provides coverage of up to $73,385 (NZD $100,000) per building for residential owners who purchase fire insurance.

Modeler EQECAT has said it also estimates insured losses from the 7.0 magnitude quake of between $1.5 billion and $2.5 billion.

AIR Worldwide puts the estimate of insured losses between $2 billion and $4.5 billion.

RMS said its estimate for total losses includes those from personal lines--including losses covered by the Earthquake Commission--as well as commercial and industrial losses. It does not include damage to infrastructure, public buildings or uninsured property.

Losses in excess of what is covered by the Earthquake Commission will be covered by the private market, but RMS said it expects this amount is likely less than 10 percent of the total losses.

Private market losses are expected to range between $400 million and $1.1 billion, RMS said.

Special Reports /

New Zealand Quake Could Cost Insurers Up To $2.5B

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