Post by Shadow on Sept 5, 2005 6:33:22 GMT -5
New York Times
By JENNIFER BAYOT
A risk management firm yesterday offered the first estimate of economic losses from Hurricane Katrina - $100 billion - and said that private insurance would probably cover less than a quarter of that. Federal money and charitable contributions may need to do the rest.
Saying the damage already appeared far greater than expected, Risk Management Solutions in Newark, Calif., said that insured losses would range from $20 billion to $35 billion, much higher than the firm's initial estimate of $10 billion to $25 billion.
The new figures suggest that Hurricane Katrina will cost the insurance industry more than any other natural disaster on record, unseating Hurricane Andrew in 1992, which cost $21 billion in 2004 dollars, according to the Insurance Information Institute, an industry group. Katrina's price tag may also overshadow the $23 billion in insured losses caused by four large hurricanes last year in South Florida.
But there is far more that commercial insurers will not absorb.
*Related
Tumult in Gulf Region but Little Early Effect Across the Nation
New York Times
By DAVID LEONHARDT and EDMUND L. ANDREWS
The broad American economy has largely withstood the early effects of Hurricane Katrina, even as residents of the Gulf Coast suffer through a regional economic disaster with few equals.
The flooding has displaced about one million workers in the Gulf Coast region, many of whom will not be able to resume their jobs anytime soon. While some employees of large companies are still receiving paychecks, Wal-Mart stopped paying workers in the area four days after shutting its stores, and McDonald's and UPS have not paid regular wages to idled employees since the storm hit.
The hurricane has also bottled up grain shipments on the Mississippi River, hurting farmers and grain exporters, and saddled households with even higher energy costs.
The effect of the damage to oil rigs and refineries in the gulf is the greatest uncertainty. But contrary to early fears, the nation's transportation network has not become overwhelmed so far, and despite spot shortages drivers have generally been able to buy gasoline. The price of crude oil fell 2 percent on Friday - to $67.57, up only $1 from a week ago - as a large importing terminal off the coast of Louisiana reopened and the International Energy Agency announced that it would release emergency oil supplies.
As corporate executives scrambled to get in touch with employees who lived in Katrina's path, most said they had seen little overall effect on their businesses.
By JENNIFER BAYOT
A risk management firm yesterday offered the first estimate of economic losses from Hurricane Katrina - $100 billion - and said that private insurance would probably cover less than a quarter of that. Federal money and charitable contributions may need to do the rest.
Saying the damage already appeared far greater than expected, Risk Management Solutions in Newark, Calif., said that insured losses would range from $20 billion to $35 billion, much higher than the firm's initial estimate of $10 billion to $25 billion.
The new figures suggest that Hurricane Katrina will cost the insurance industry more than any other natural disaster on record, unseating Hurricane Andrew in 1992, which cost $21 billion in 2004 dollars, according to the Insurance Information Institute, an industry group. Katrina's price tag may also overshadow the $23 billion in insured losses caused by four large hurricanes last year in South Florida.
But there is far more that commercial insurers will not absorb.
*Related
Tumult in Gulf Region but Little Early Effect Across the Nation
New York Times
By DAVID LEONHARDT and EDMUND L. ANDREWS
The broad American economy has largely withstood the early effects of Hurricane Katrina, even as residents of the Gulf Coast suffer through a regional economic disaster with few equals.
The flooding has displaced about one million workers in the Gulf Coast region, many of whom will not be able to resume their jobs anytime soon. While some employees of large companies are still receiving paychecks, Wal-Mart stopped paying workers in the area four days after shutting its stores, and McDonald's and UPS have not paid regular wages to idled employees since the storm hit.
The hurricane has also bottled up grain shipments on the Mississippi River, hurting farmers and grain exporters, and saddled households with even higher energy costs.
The effect of the damage to oil rigs and refineries in the gulf is the greatest uncertainty. But contrary to early fears, the nation's transportation network has not become overwhelmed so far, and despite spot shortages drivers have generally been able to buy gasoline. The price of crude oil fell 2 percent on Friday - to $67.57, up only $1 from a week ago - as a large importing terminal off the coast of Louisiana reopened and the International Energy Agency announced that it would release emergency oil supplies.
As corporate executives scrambled to get in touch with employees who lived in Katrina's path, most said they had seen little overall effect on their businesses.