Japan quake, tsunami could produce 300 billion in property casualty insurance claims

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Japan quake, tsunami could produce 300 billion in property casualty insurance claims

This is the latest estimates on the losses in Japan….

SENDAI, Japan—Economic losses from the earthquake and tsunami that struck Japan likely will be $200 billion to $300 billion, catastrophe modeler Risk Management Solutions Inc. said Monday.

Newark, Calif.-based RMS said in a statement that it is too soon to estimate insured losses from the deadly March 11 earthquake and tsunami, but said only a “minor proportion” of the total losses would be covered by insurance.

An economic loss of $200 billion to $300 billion is equivalent to about 4% to 5% of Japan’s gross domestic product, RMS said in the statement.

RMS said the earthquake and tsunami was a complex, “super cat” event and that its cost estimate reflects not only property damage but secondary consequences, such as disruption to power supplies, evacuations and decommissioning of several nuclear power stations.

There also is concern about potential crop contamination, RMS said.

Another catastrophe modeling firm, EQECAT Inc., said last week that insured losses from the earthquake could be in the range of $12 billion to $25 billion.

In addition, AIR Worldwide Corp. has estimated insured losses from the earthquake, excluding damage caused by the tsunami, to range from $15 billion to $35 billion.

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