Canadian Underwriter

PERILS AG almost doubles initial property loss estimate for Central Italy earthquake

November 24, 2016   by Canadian Underwriter

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PERILS AG’s second loss estimate for insured property loss associated with Central Italy’s earthquake in August has almost doubled from 34 million euros to 66 million euros.

A man walks by rubble in the village of Santi Lorenzo e Flaviano, central Italy, Saturday, Aug. 27, 2016. Italians bid farewell Saturday to victims of the devastating earthquake that struck a mountainous region of central Italy this week. (AP Photo/Andrew Medichini)

The third loss estimate for the quake is scheduled to be published Feb. 24, 2017, notes a statement Thursday from the company, an independent, Zurich-based organization that provides industry-wide catastrophe insurance data.

Related: August earthquake in Italy expected to cost 34 million euros in property damage, PERILS estimates

The epicenter of the magnitude 6.0 quake on Aug. 24 was located near the borders of the Lazio, Marche and Umbria regions, an area known for experiencing high seismicity, PERILS AG reported when it released its first loss estimate in early October.

Map of seismic activity for Central Italy earthquakeClaiming the lives of 298 people, mostly in small towns, “the last significant earthquake in the Central Apennine mountain range occurred in April 2009 and mainly affected the town of Aquila, which is situated only 45 km to the south of this event,” it added.

Noting at the time that earthquake insurance varies greatly in Italy, “as a general rule, insurance penetration is driven by economic activity,” said Luzi Hitz, CEO of PERILS. “Had a similar earthquake occurred in a heavily industrialized area of Italy, insurance penetration and insured losses would have been much higher,” Hitz noted.

In late August, Fitch Ratings reported that it was estimating insured losses of 100 million to 200 million euros, arising mainly from property lines, related to the quake.

It suggested insured losses could be 40 million euros to 80 million euros for primary insurers and 60 million euros to 120 million euros for reinsurers.

In late October, Italy experienced a series of earthquakes that hit a similar region in Central Italy from Oct. 26 to 30.

Related: Officials in quake ridden central Italy assess damage

Should PERILS conclude that this is a qualifying event, a first loss report is scheduled to be released Dec. 7.