The earthquake that rocked Chile on February 27 will cost insurance companies an estimated $4-7 billion (SFr4.3-7.5 billion) in claims, Swiss Re has announced.
The world’s second largest reinsurance company, which sells insurance to insurance companies, said the amount of damage it would cover in Chile has climbed to around $500 million. That comes on top of $100 million in claims following a storm that recently swept across Europe, Xynthia.
Chile has certain building codes in place but the 8.8-magnitude quake that killed some 500 people caused hundreds of thousands of buildings to collapse and left up to 500,000 people without shelter.
The disaster has created massive charges for domestic insurance companies that provide coverage for property damages as well as losses linked to interruptions in commercial activities. Total repairs could reach as high as $30 billion, the Chilean government said.
After suffering heavy losses in 2008, Swiss Re, based in Zurich, posted a profit for 2009 of SFr506 million ($470.3 million).
swissinfo.ch and agencies