According to a BBC report, U.K. insurers’ preliminary estimates of the claims they may face from three days of high winds and rain, which have caused extensive damage in southern England, is put at around £200 million ($293 million). But a Reuters report puts loss estimates at a much higher figure.
“We would estimate that only half the property damaged in the storms was insured, ” Reuters quoted Jeffrey Salmon an insurance assessor with Salmon Associates as saying. “At the moment we are looking at a total figure for insurance payouts of between 350 and 450 million pounds [$512 and $659 million], so the total cost could well be nearly one billion pounds.”
Although substantial , those estimates are far less than the £1.25 billion ($1.83 billion) caused by the 1987 storms and the £2 billion ($2.93 billion) insurers paid out in 1990.
However, it’s only October, and, according to weather reports, more storms are on the way, which could cause further damage and increase losses.
An analysis of winter weather conditions from Boston’s Applied Insurance Research (AIR) predicts “a stormier season than average this year for Northwest Europe, including France, Denmark and the UK.” It noted that extreme weather is becoming increasingly common.
AIR has developed a series of ‘probabilistic ensemble forecasts” which are designed to provide the insurance industry with a more realistic picture of “current climatic conditions,” which in turn helps to refine “their catastrophe modeling systems.”
AIR President and CEO Karen M. Clark stated that, “Advanced technology and better data give our clients a clear competitive advantage when making their pricing and underwriting decisions.”
Greater preparation might also serve to limit damages and loss of life.
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