Insured losses from Hurricane Sandy are estimated at between $5 billion and $10 billion, with total economic damages potentially reaching between $10 billion and $20 billion, according to catastrophe risk modelling firm EQECAT.
Hurricane Sandy, which is expected to make landfall in the eastern United States late Monday, is affecting an estimated 60 million people. Many residents in New York, New Jersey and other eastern states have been ordered to evacuate, and several major cities have shut down their transit systems.
“Housing and general commercial occupancies are expected to comprise most of the damage,” Tom Larsen, senior vice president and product architect at EQECAT wrote in a statement. “Newer commercial and industrial occupancies are expected to benefit from improvements to building codes and receive less damage, although chaotic winds could produce pockets of higher damage.," he added,
"Flooding is expected to cause widespread incidents of localized flooding, and storm surge along the coast has already produced reports of flooded streets in some areas, all consistent with EQECAT's economic damage estimate.”
Economic damages include property damage from wind, rain and flood, as well as “intangibles such as business interruption and additional living expenses, damage to infrastructure utilities include roads, water and power, and municipal buildings which may or may not be insured,” according to the company.
Estimating reinsurance losses is uncertain, because damage to insured properties will last over several days over a wide geographic area, EQECAT noted.
Hurricane Irene in 2011 caused roughly $10 billion in economic damages, while 2008’s Hurricane Ike caused between $20 billion and $30 billion in economic damages, according to EQECAT.
Eastern Canada, including south-central Ontario, Quebec and the Atlantic provinces, will feel the impact of the storm through Monday night, including intense winds and rainfall. Risks from the storm in Canada include broken tree limbs from wind, along with potential flooding from drainage systems blocked by leaves.
Image: Hurricane Sandy seen from space on Oct. 29 at 9:10 a.m. ET. (Credit: NASA GOES Project)