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PISCO, PeruInsured losses from a magnitude 8.0 earthquake, which killed hundreds and left tens of thousands homeless in Peru, are not likely to exceed $1 billion, Boston-based catastrophe modeler AIR Worldwide estimated.
Economic losses from last week's temblor, meanwhile, could reach between $10 billion and $20 billion, according to EQECAT Inc., an Oakland Calif.-based catastrophe modeling company.
EQECAT estimated residential areas sustained about half the economic damage, with commercial/industrial structures suffering the remainder.
Both modeling companies reported that the percentage of residential property that is insured is likely to be low. But insurance takeup rates for commercial structures, especially those owned by multinational companies, are much higher and will drive insured losses.
The earthquake was centered 90 miles southeast of the county's capital, Lima.
In Lima, where most of the country's businesses and industries are located, property and business interruption claims are not expected to be substantial, said Nicolas Salazar, chief executive officer for Segurnet S.A., an insurance broker serving large commercial policyholders in Lima.
Peru's main port in Pisco, about 125 miles south-southeast of Lima, suffered significant damage and disrupted trade. Some international companies had already arranged to ship cargo through other ports, he said.
Most claims are likely come from communities to the south where damage was heavy. Hotels, fisheries and the electrical system were also affected with some businesses suffering serious damage, Mr. Salazar added.
Peru, which has a history of large quakes, implemented a seismic code for buildings in 1970. But about 60% of the country's construction is masonry and another 15% is adobe, according to AIR Worldwide.
"Unfortunately, while Peru's building code is now quite good, many commercial structures in the region predate it," Guillermo Franco, senior research engineer at AIR Worldwide, said in a statement.