Tsunamis ‘cause €10bn damage’

THE tsunami catastrophe has caused economic damage in excess of €10 billion, a top risk researcher at Munich Re, the world’s largest reinsurer, said yesterday.

Gerhard Berz, head of Geo Risk Research at the Munich-based firm, told the Deutsche Welle German television channel that the estimate was based on a “gut feeling” since reliable numbers were not yet available.

The estimate does not reflect the cost to insurers, which is likely to be a relatively small portion of the overall cost and made up mainly of damaged property and insurance cover for casualty.

The insurance industry will likely review its risk exposure models, in which catastrophe scenarios centre on risks in single markets and single regions, following this catastrophe and after this autumn’s hurricanes which struck the Carribbean, he added.

Analysts say the cost of the tsunami was less than the hurricanes as there is less insurance coverage and industrial density in Asia.