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AIR Worldwide estimates Hurricane Irene insured losses at $3B to $6B

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AIR Worldwide estimates Hurricane Irene insured losses at $3B to $6B

BOSTON—Insured losses from Hurricane Irene likely will be between $3 billion and $6 billion, according to catastrophe modeler AIR Worldwide Corp.

Boston-based AIR said Monday that its estimate for onshore property losses in the United States included estimates for wind and storm surge damage to onshore residential, commercial and industrial properties and their contents, automobiles and time element coverages such as business interruption for commercial properties, and additional living expenses for residential properties.

AIR said its estimate assumed a 10% take-up rate for commercial flood insurance policies and that insurers eventually would pay about 10% of modeled storm surge damage and wind losses for residential insurance coverages.

The catastrophe modeler said the range of its loss estimate reflected continuing uncertainty about the surface-level wind speeds caused by the storm.

Hurricane Irene caused widespread destruction along the U.S. East Coast after making landfall as a Category 1 hurricane in North Carolina on Aug. 27.

Initial estimates by Oakland, Calif.-based EQECAT Inc. put insured damage in the Carolinas at between $200 million and $400 million, while Silver Spring, Md.-based consultant Kinetic Analysis Corp. said total U.S. insured losses from the storm likely would be slightly less than $3 billion.

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