While any accurate figures of the economic cost of Hurricane Charley’s deadly passage through Florida will not be available for some time, it’s becoming clear that, although the storm was a major catastrophe for the insurance industry, it will have less of an economic impact on the world’s insurers and reinsurers than originally feared.
It won’t approach Andrew’s $22 million (in today’s dollars). RMS gave a preliminary estimate of around $5 billion (see IJ Aug.16). Munich Re put the insured losses at between $7 and $14 billion, and indicated that its own exposure would probably be “a low triple-digit euro sum,” according to a report from AFP. AIR Worldwide indicated losses would be in the $6 to $10 billion range.
Most of the world’s major insurers and reinsurers, including Lloyd’s, Swiss Re, Zurich, Converium, a number of Bermuda-based companies and others have yet to issue loss estimates, although they have indicated that they do expect to handle a significant number of claims.
While they’re assessing the losses, for the most part they have echoed A.M. Best’s assessment that the catastrophe will have a relatively small impact on any company’s bottom line (See lead article).
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