Man-made and technological catastrophes caused around USD7 billion in insured losses last year. This put 2008 losses around 46 percent higher than the annual average of USD4.8 billion, according to data from Swiss Re. Nineteen known events resulted in insured losses of more than USD50 million each, according to publicly available information. These events occurred in 11 countries, with losses ranging from USD80 million to nearly USD2 billion.
Nearly half of 2008’s man-made catastrophe losses were caused by two events: an explosion and fire at an Apache Energy offshore gas plant (USD1.8 billion) and BHP Billiton’s business interruption losses (USD1.5 billion) — both in Australia. Two events in the United States caused losses of at least USD400 million, and the terror attack in Mumbai, India, could trigger insurance claims of up to USD600 million.
Risk losses in the mining, energy and steel industry were particularly large in 2008, with claims exacerbated by the impact of record high commodity prices on business interruption cover. Apache Energy’s offshore gas plant explosion and fire — on Varanus Island in Western Australia — interrupted the supply to one of the world’s most significant mining areas, reducing the supply of natural gas to the region by 30 percent, which was a major factor in pushing the incident’s insured losses to nearly USD2 billion.
Over the next four days, we will publish summaries of 2008’s largest man-made catastrophes by quarter (based on publicly disclosed information). To be notified of their availability by e-mail, click here to register for updates from GC Capital Ideas.
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Guy Carpenter’s Instrat® department provides CAT-i reports for major natural catastrophes worldwide. These reports cover catastrophes including worldwide tropical cyclones, earthquakes, major UK and European floods and any other natural event that is likely to incur a significant loss to the (re)insurance industry. Please email CAT.firstname.lastname@example.org if you wish to be added to the free email distribution list.
Instrat also provides RISK-i reports for major technological or man-made events worldwide. These reports cover risks to property, transport and life including explosions, fires, crashes, engineering disasters and terrorist attacks that are likely to incur a significant loss to the (re)insurance industry. Please email RISK.email@example.com if you wish to be added to the free email distribution list.