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Member, Beacon International Group, Ltd.
OAKLAND, Calif.—EQECAT Inc. has increased its economic damage estimate from the 7.0 magnitude earthquake that struck Haiti on Jan. 12 to the “low-single-digit billions of dollars” from its former estimate of “hundreds of millions” of dollars.
Moreover, fatalities from the quake could number in the tens of thousands, the Oakland, Calif.-based catastrophe modeling firm projected. News reports late Friday suggested the final toll could be well over 100,000.
However, EQECAT has not yet released an estimate of insured losses from the event, which is likely to be significantly lower, industry experts say.
Because Haiti is the poorest country in the Western Hemisphere, the insurance market is not very developed, explained Nikhil da Victoria Lobo, vp for Swiss Reinsurance Co.'s public sector team based in New York.
“In Haiti, one of the challenges has been distribution,” he said.
Swiss Re is the lead reinsurer of the Caribbean Catastrophe Risk Insurance Facility, which is preparing to pay the Haitian government $8 million, the limits of a policy it purchased from the pool for a $385,500 premium.
The CCRIF policy will provide a revenue stream for the government to continue operating after the disaster, according to Simon Young, supervisor of the pool, which formed in 2007. Sixteen Caribbean governments participate in CCRIF, which is designed to limit the financial impact of natural disasters such as hurricanes and earthquakes in the region.