Hurricane Katrina insurance claims could top $26bn

The US property and casualty insurance industry, hit hard last year when four separate hurricanes slammed into Florida, now faces as much as €26bn in claims from Hurricane Katrina’s foray into Louisiana and neighbouring Gulf Coast states, according to preliminary risk assessments.

The US property and casualty insurance industry, hit hard last year when four separate hurricanes slammed into Florida, now faces as much as $26bn (€16bn) in claims from Hurricane Katrina’s foray into Louisiana and neighbouring Gulf Coast states, according to preliminary risk assessments.

AIR Worldwide, a risk modelling firm based in Boston, said late yesterday that insured losses could range from €12bn (€7.4bn) to €26bn (16bn).

At the high end, that would make Katrina more expensive than the previous record-setting storm, Hurricane Andrew, which caused some $21bn (€12.9bn) in insured losses in 1992 to property in Florida and along the Gulf Coast.

Another risk modelling firm, Eqecat, which is based in Oakland, California, initially estimated damages from Katrina at up to €30bn (€18.3bn), but it lowered its projections twice after the storm struck east of populous New Orleans and was quickly downgraded as it moved inland from a Category 4 hurricane to a Category 2 storm.