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Insurers struggle to asses damage in cyclone-hit Fiji

1 March 2016 | walter

Damage to Fiji’s communications facilities is making it difficult for insurers to assess the destruction left by Tropical Cyclone Winston, the strongest storm to have struck in the southern hemisphere. New Zealand insurer Tower and global loss adjuster Crawford & Company say it will take a while to estimate insured claims in the Pacific island nation.

Tower has a “significant reinsurance program” in place to provide cover once its excess of $NZ10 million ($9.3 million) is breached, meaning the maximum possible impact to the company is only $NZ7.2 million ($6.7 million) after tax.

“However, given the difficulties caused by power and communication outages in Fiji, Tower anticipates it will not have a thorough understanding of the damage and therefore the financial implications of the cyclone for some days yet,” the insurer says.

Crawford & Company has dispatched a team of adjusters to Fiji to assist clients. It expects the situation to be clearer as communication lines are gradually restored. Munich Re agrees it will take time to assess the damage. “Of course, it is far too early to speak about estimates for the losses from Winston’s extreme high gusts and several-hundred millimetres of rain,” the reinsurer’s Head of Geo Risks Research Unit Peter Hoeppe said. “When looking at possible financial losses, one must see that, unfortunately, the insurance density in developing countries such as Fiji is still rather low.”

Fiji’s Attorney-General Aiyaz Sayed-Khaiyum has reportedly said initial estimates put the damage at about $US470 million ($650 million). More than 40 people died in the storm, and a 30-day state of natural disaster has been declared.

Scource: insurancenews.com.au