Swiss Re issued a statement which stressed that it is “committed to the Japanese insurance market and to supporting the country’s recovery from the devastating earthquake and tsunami which claimed many lives last week.”
Chief Executive Stefan Lippe added: “We are deeply sympathetic to all those who suffered from the disastrous earthquake and tsunami in Japan. Our role is to support the Japanese people in quickly recovering from this unprecedented and tragic event. Swiss Re Group remains wholly committed to continuing to provide capacity to the Japanese market and maintaining our strong relationships with clients.”
The bulletin also confirmed previous reports, which have indicated that the “circumstances in Japan are particularly complex since damage to property was not only caused by the earthquake itself but also by fire following the earthquake and the ensuing tsunami. In terms of residential insurance policies, the cover for earthquake shock and tsunami are provided by a government-run scheme.
“This cover is typically not re/insured in the private market. Cover for fire following earthquake is provided by primary insurers and is typically protected by their reinsurance coverage. For commercial and industrial insurance policies, cover is sold in the private market and is widely purchased for earthquake, fire following earthquake and tsunami.”
Referring to the damage suffered by the nuclear facility at Fukushima, Swiss Re noted that “generally, coverage for nuclear facilities in Japan excludes earthquake shock, fire following earthquake and tsunami, both in terms of physical damage and liability. Coverage for property policies excludes nuclear contamination. Overall, there is unlikely to be a significant impact on the Property & Casualty insurance industry as a result of this nuclear incident.”
Swiss Re added that it is “currently evaluating its exposure to the event. Given the nature of the destruction, combined with the ongoing recovery efforts and evacuation areas, it will take some time to estimate the damage.”
Source: Swiss Re
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