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Financial News

Nov 2012 Financial News

Superstorm Sandy hits reinsurer for US$900m

Nov 30, 2012

REINSURANCE company Swiss Re estimates that claims stemming from the destruction caused by Superstorm Sandy will cost the company about US$900 million.

The Swiss company also estimated Monday that total losses from insured damages will total between US$20 billion and US$25 billion.

Superstorm Sandy last month hit the Caribbean before making landfall on the US East Coast, where it caused havoc, inflicting extensive damage and killing scores of people. Reinsurance firms such as Swiss Re provide coverage to insurance companies for great losses stemming from events like natural disasters.

Sandy devastated Jamaica's eastern parishes, but the island's insurance industry expected losses from the storm to be minimal.

The worst of the storm missed the Corporate Area, where most of the insured properties are, insurers said. And while there were billions of dollars in estimated losses to crops and infrastructure, neither is heavily insured.

Sandy, however, was among the 10 most costly hurricanes in US history. But despite the heavy damage in the US, Jamaica International Insurance Company boss Andrew Levy did not expect it to be reflected much in reinsurance rates for Jamaican firms — insurance companies purchase reinsurance to diversify their risk exposure.

"I don't think it's going to change anything too much," Levy said at the time. "It has been fairly catastrophe-free for little over a year and usually you find that one storm doesn't really affect the market too much."

Jamaica Observer
Friday November 30, 2012