Kandla cyclone among 20 costliest
insurance losses
Nature
has put India on the global risk map. The cyclone, which tore Kandla apart
in June 1998, has turned out to be one of the world’s 20 most expensive
losses incurred by insurance companies in 1998. The loss, estimated at
$ 217m, is the largest by Indian standards. However, it is a mere fraction
of the $10.74 bn property losses in the US, resulting in natural calamities.
According to the Sigma report
by Swiss Re, which classifies losses both in terms of cost and human casualties,
the US alone accounted for 61 per cent of the world insured losses of
$ 17.5 bn. However, fatalities in the US were just 2 per cent of the global
human casualties of 44,703 lives.
"Asia sustained a high frequency
of losses, with almost one half of all events in 1998 taking place in
the region. However, the low insurance penetration here results by comparison
in low insured losses," the report said. As a result, the losses in Asia
accounted for $ 1.5 bn or nine per cent of global losses.
Two hi-tech refineries in
Jamnagar belonging to Reliance Petroleum and Essar Oil as well other PSU
fertiliser and oil units were concentrated in the area. Though the project
losses exceeded Rs 1,100 crore, the liability of the Indian insurers was
restricted to Rs 17 crore thanks to reinsurance cover. In 1998, the Indian
sub-continent accounted for nearly an eighth of the world’s human fatalities.
Floods and landslides claimed nearly 3,000 lives in India, Nepal and Bangladesh.
The Kandla cyclone and the heat wave in May claimed 1,150 and 1,000 lives
respectively.
Overall
losses from disasters total $ 66 billion
THE overall losses resulting
from disasters in 1998 totalled $ 65.5 bn, a near 130 per Cent
in crease from the previous year’s total. Most of these losses
stemmed from natural disasters.
The report notes that in
1998 insurance companies suffered a total loss of $17.5 bn because of
disasters, both natural and manmade. Of this, $ 14 bn could be attributed
to natural catastrophes while man-made disasters such as riots in Indonesia,
satellite losses, accounted for $ 3.5 bn.
The costliest insurance claims
by far were for damages suffered during last September’s Hurricane Georges
- it caused $3.5 bn worth of damage in the US and the Caribbean. The Minnesota
hailstorm in mid-May comes in second. The insured losses - $1.3 bn in
the US alone. In terms of fatalities, natural calamities claimed almost
35,000 lives. Hurricane Mitch swept away nearly 9,000 in the Honduras,
Nicaragua and the neighbouring countries.
In India, the major man-made
disasters include three cases of vessels capsizing, four railway accidents,
twelve cases of vehicles plunging into a river/ravine as well as deaths
due to contaminated liquor and mustard oil.
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Compiled from Local News Media
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