New York - At more than $40 billion in insured losses, Hurricane Katrina is the costliest hurricane on record. Insurers have tallied most of the property damage and business interruption losses, but Katrina's financial effects will continue to be felt for a very long time.Floodwaters in the aftermath of Hurricane Katrina bathed New Orleans and surrounding areas in a "toxic soup" of infectious organisms and hazardous chemicals. Ruptured oil tanks and pipelines covered portions of the area and nearby waters with an estimated 8 million gallons of oil. A resulting large number of environmental-related lawsuits have been filed, potentially exposing the insurance industry to billions of dollars in addition losses.
These observations are made by Advisen Ltd., a company that provides insight into underwriting, marketing and purchasing commercial insurance. In an Advisen QuickNote titled "Toxic Storm: Hurricane Katrina and Environmental Liability," the company provides an overview of the storm-related damages, the ensuing lawsuits, and the commercial insurance industry implications.
The note can be accessed via: http://fpn.advisen.com/fpnHomepagep.shtml?resource_id=473716431339209282#top.
Advisen has also updated its list of complete 2005 Hurricane Losses by Company. The revised pre-tax insurance loss number is about $64 billion (up from Advisen's December estimates of $58 billion). The difference is largely due to increases in reported losses for hurricane Katrina and Rita reported by a number of companies with their year-end numbers, and substantial new reported losses from a couple of companies such as Oil Insurance Ltd.
Source: Advisen Ltd.
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