Insurers worldwide yesterday began counting the cost of the damage wreaked by Hurricane Charley, but shares in Lloyd's of London companies were helped by hopes of higher premiums next year.
The initial estimate of the economic loss caused by the category 4 storm, which came ashore with 232kph winds on Florida's Gulf Coast on Friday night, is estimeated to be about $20 billion (€16.18 billion).
Munich Re, the world's biggest reinsurer, said insured losses were likely to be in the range of $7-14 billion, although some UK analysts thought the final bill might actually be lower at $4-10 billion.
The storm killed 16 people and left thousands homeless.
Several hospitals were badly damaged and entire counties left without power. If the worst estimates prove accurate, Charley becomes the second most expensive storm of all time, after Hurricane Andrew in 1992, and the fourth most expensive insured event, after Andrew, the 9/11 terror attacks and the Los Angeles earthquake of 1994.
After Andrew 12 years ago, many insurers pulled out of providing hurricane cover to the affected areas and various quasi-governmental funds stepped in.
They will now limit exposure faced by the private insurance sector.
Shares in the big reinsurers tumbled as the markets opened yesterday but by the close most had recovered to be flat on the day or slightly up.- (Guardian Service)
