Insurance says Katrina largest loss ever

LONDON – Hurricane Katrina is the costliest disaster ever, with the insurance industry slice of the clean-up bill reaching as much as US$50 billion (N$315 billion), the Chief Executive of Brit Insurance said yesterday.

“Be in no doubt this is the largest insured loss that has ever occurred. The trouble is we have no idea how big it will be,” Dane Douetil, the Brit Insurance Holdings Plc CEO, said in a conference call with reporters.The ultimate insured loss is likely to be far above what is currently being estimated by experts, he said.”It would be more prudent to work on an industry loss of nearer US$50 billion than it would US$35 billion.”The insurance industry has never had to deal with the range and complexity of claims that are likely to come from the damage wrought by Katrina, which devastated the US Gulf Coast last week and may have killed thousands.”You have buildings standing in water for what could be up to 80 days, which is the time period they’re thinking of before they can get the flood water out.What you’re now talking about is constructive write-off for virtually all the buildings,” Douetil said.Normally if a hurricane hits an area, buildings that have been damaged but not destroyed can be repaired.But because of the widespread flooding that accompanied Katrina, many thousands of homes may effectively have to be destroyed and rebuilt.Pollution caused by chemicals and other substances that have been washed out of factories by the floodwater may also cost a lot of money to clean up, Douetil added.”This is the kind of loss that nobody has any experience of,” Douetil said.Brit said it was too early to put a figure on its own claims from the hurricane.-Nampa-ReutersThe trouble is we have no idea how big it will be,” Dane Douetil, the Brit Insurance Holdings Plc CEO, said in a conference call with reporters.The ultimate insured loss is likely to be far above what is currently being estimated by experts, he said.”It would be more prudent to work on an industry loss of nearer US$50 billion than it would US$35 billion.”The insurance industry has never had to deal with the range and complexity of claims that are likely to come from the damage wrought by Katrina, which devastated the US Gulf Coast last week and may have killed thousands.”You have buildings standing in water for what could be up to 80 days, which is the time period they’re thinking of before they can get the flood water out.What you’re now talking about is constructive write-off for virtually all the buildings,” Douetil said.Normally if a hurricane hits an area, buildings that have been damaged but not destroyed can be repaired.But because of the widespread flooding that accompanied Katrina, many thousands of homes may effectively have to be destroyed and rebuilt.Pollution caused by chemicals and other substances that have been washed out of factories by the floodwater may also cost a lot of money to clean up, Douetil added.”This is the kind of loss that nobody has any experience of,” Douetil said.Brit said it was too early to put a figure on its own claims from the hurricane.-Nampa-Reuters