Ivan's Insured Losses $3 Billion-$6 Billion - Group
Date: 24-Sep-04
Country: USA
Risk Management Solutions, which provides catastrophe risk management products to the financial services sector, said it came up with its latest estimate after engineers examined wind damage in the Gulf Coast area where Ivan struck on Sept. 16.
RMS last week estimated likely insured losses of between $2 billion and $7 billion. On top of the U.S. losses, Ivan caused insured damage of $1 billion to $2 billion in the Caribbean.
The company said aerial and ground surveys established that the area of strongest winds on the U.S. Gulf Coast was in Baldwin County, Alabama, and immediately to the east in Escambia County, Florida.
"More than half of the total loss is expected in Florida, where insurers have already sustained losses of $9 to $14 billion from hurricanes Charley and Frances," RMS said in a statement.
It said Ivan, one of the most powerful Atlantic storms ever recorded, produced much higher levels of storm surge damage than the other two hurricanes this season.
A storm surge 10 to 16 feet above normal caused multistory commercial buildings to collapse after their foundations gave way, it said.
Most flood losses are covered by a federal insurance scheme. But many coastal properties experienced both wind and flood damage, potentially complicating claims, RMS said.
Specialty energy sector insurers would also be hit by claims because Ivan sent several Gulf of Mexico oil rigs adrift, the company added.
