The physical devastation to the US Gulf Coast caused by the impact of hurricanes in 2005, including Katrina, Rita and Wilma, was clear for all to see.
But the long-term financial impact on the world’s insurance industry is only just beginning to become clear. Total estimates are in the region of $100bn (£57.6bn) with losses from Hurricane Katrina alone accounting for more than half of this. Some have suggested the eventual claims in respect of Katrina will be in excess of $60bn (£34.5bn) – even more if flood losses have to be indemnified by insurers. While everyone hopes the final figure will be less, there is every prospect that it may well turn out to be worse.
