Catastrophic 2005 is insurers' costliest

By Alice Ratcliffe

BLOOMBERG NEWS

Insurers had their costliest year in 2005, racking up an estimated $80 billion in losses amid catastrophes such as Hurricane Katrina, Swiss Reinsurance Co. said yesterday." The full scale of the catastrophes in 2005 has not yet been fully assessed, but the trend toward very high losses appears to be continuing," Swiss Re, the world's second-largest reinsurer, said in a statement with a copy of a study.

Katrina, which struck the U.S. Gulf Coast on Aug. 29, resulted in an estimated $45 billion in insured losses, according to the study. In all, 112,000 people have died in disasters this year, with at least 90 percent of those in Asia. They included more than 87,000 people killed by an earthquake that struck Pakistan and India on Oct. 8. An earthquake in Indonesia's Sumatra Island in March killed 2,600 people.

"The high death toll from these events is due to the high seismicity, but also to poor building standards in the regions affected," Swiss Re said in the study, written by Aurelia Zanetti, Clarence Wong and Thomas Holzheu.

"The ongoing warm phase that has been measurable since the 1990s and the recent high hurricane frequency inspire little hope of this trend being reversed anytime soon," the company said. It said the total financial loss from natural and man-made disasters this year was $225 billion, of which $80 billion was insured.

Swiss Re, a property, life and health insurer based in Zurich, operates in 30 countries.

Biggest Losses

These were the worst insured disasters of the year.

• Hurricane Katrina: U.S. Gulf Coast and Bahamas, $45 billion in insured losses.
• Hurricane Rita: U.S. Gulf Coast and Cuba, $10 billion.
• Hurricane Wilma: United States, Mexico, Jamaica, Haiti and Cuba, $8 billion.
• Hurricane Dennis: United States, Caribbean, Haiti and Cuba, $2 billion.
• Floods, landslides caused by rain: Switzerland, Germany, Austria and others, $1.9 billion.
• Winter storm Erwin: Denmark, Sweden, United Kingdom, Norway, Germany and others, $1.5 billion.

SOURCE: Swiss Re

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