Record losses for property insurers in 2001

The September 11 attacks in New York (above) and Washington left an estimated 3,300 dead Keystone

Man-made and natural catastrophes claimed more than 33,000 lives in 2001, according to the Swiss Reinsurance Company in Zurich.

Swiss Re said the direct financial loss from major disasters in 2001 is expected to be more than $115 billion (SFr188.14 billion), of which more than $32 billion will be borne by the insurance industry.

The economic losses are more than three times the annual average for the 1990s.

The September 11 attacks in the United States are expected to cost $19 billion in property claims and lost business alone. They make up one of the largest property losses in the history of the insurance industry.

Swiss Re said that the figures do not include the indirect negative impact on the equity markets and the global economy.

High death toll

According to Swiss Re researchers, the estimated death toll from the attacks on the World Trade Center in New York was nearly 3,300, a figure dwarfed by 15,000 killed in the earthquake on January 26 in Gujarat, India.

The September 11 attacks caused the biggest economic loss by far – estimated at $90 billion – but, the researchers pointed out, the Code Red computer worm and the explosion of a drilling platform off the coast of Brazil also caused billion-dollar losses.

This year was distinguished by the scale of man-made catastrophes, which accounted for 70 per cent of losses; usually natural disasters account for a larger proportion.

Natural catastrophes

Two natural catastrophes in the US exceeded the billion-dollar mark in 2001 – Storm Allison on June 5 ($2.5 billion) and an April storm which caused flooding, hail and wind (insured damage of $1.9 billion).

In comparison, the most expensive natural catastrophe to date was Hurricane Andrew, which cost the industry $20.2 billion in 1992.

Swiss Re concludes that the trend towards higher losses continues given the risk factors of high population densities, and higher concentrations of insured values, especially in endangered areas.

And after the large losses in 2001, the risk of terrorism “must increasingly be factored into the equation”, the researchers concluded.

swissinfo