Showing posts with label Sandy. Show all posts
Showing posts with label Sandy. Show all posts

Sunday, June 30, 2013

Alleghany Expects $288M Sandy Loss; Assurant Estimates $200M Loss

December 20, 2012Email ThisPrintNewslettersTweetArticleComments

Alleghany Corporation said this week its preliminary estimate of after-tax loss related to Sandy — net of reinsurance and reinstatement premiums — would be approximately $288 million.

Alleghany said this estimate reflects a consolidated pre-tax loss estimate, net of reinsurance and reinstatement premiums, of approximately $443 million, comprising $265 million from Transatlantic Holdings Inc., $165 million from RSUI Group Inc., and $13 million from Alleghany’s Homesite Group Incorporated investment.

Alleghany’s preliminary loss estimate is based upon an analysis of reported claims, an underwriting review of in-force contracts, estimates of losses resulting from wind and other perils, including storm surge and flooding to the extent covered by applicable policies, and other factors requiring considerable judgment.

The company said the ultimate amount of actual losses may be materially different from this preliminary estimate due to the size and complexity of the event and the preliminary nature of the information available to prepare the estimate. These Sandy-related losses will be reflected in Alleghany’s fourth quarter 2012 results, and any subsequent changes will be recorded in the period in which they occur.

Meanwhile, Assurant Specialty Property said it expects losses from Superstorm Sandy to be in the range of $200 million and $220 million on a pre-tax basis and net of reinsurance. Based on this estimate, the company said it does not expect to exceed the retention limit of its 2012 property catastrophe reinsurance program.

Assurant Specialty Property, part of Assurant, is a leading provider of renters and lender-placed homeowners insurance and the sixth-largest administrator of the National Flood Insurance Program (NFIP). In addition to paying the majority of more than 13,000 Sandy-related claims on its own policies, the company has processed nearly 9,300 claims for the NFIP.

 

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Sunday, February 24, 2013

Art Insurers Face Record Loss from Superstorm Sandy

December 21, 2012Email ThisPrintNewslettersTweetArticle1 CommentsFine art insurers face claims of up to half a billion dollars, their biggest ever payout, to compensate the owners of artwork destroyed when Superstorm Sandy flooded galleries in New York.

Work by 1960s graphic artist and illustrator Peter Max accounts for the bulk of the loss, landing insurers including Catlin with a claim of $300 million, an industry source said.

“This will be the largest single art loss to the market,” said Filippo Guerrini-Maraldi, head of fine art at insurance broker RK Harrison.

Catlin declined to comment.

Axa, the world’s biggest art insurer, expects to pay out $40 million, art claims director Colin Quinn said, and brokers and underwriters say the total loss could reach $500 million.

That would wipe out virtually a full year’s revenues for the art insurance industry, forcing it to push up its prices.

“Some underwriters will lose appetite for writing fine art business after Sandy, the global capacity for fine art business will shrink, and as a result rates will go up,” Guerrini-Maraldi said.

Galleries and art warehouses affected by Sandy could be forced to pay up to 25 percent more for insurance, and insurers could refuse to cover premises in low-lying areas of Manhattan against floods, one underwriter said, asking not to be named.

Under Water

Sandy, which killed 132 people as it swept through the north-eastern United States on Oct. 29, caused flooding in the Chelsea district of Manhattan, where many New York art galleries are located. Art warehouses in New Jersey were also affected, insurers and brokers say.

Sandy is expected to cost the insurance industry a total of $25 billion, making it the second costliest storm after Hurricane Katrina in 2005.

Art insurers have previously expressed concern that popular art storage warehouses accumulate too much costly artwork in a single location, exposing them to big losses if the facilities flood or catch fire.

The art insurance industry, led by Axa and Bermuda-based Hiscox, takes in between $500 million and $600 million a year in premiums.

Art insurance prices have been falling for several years, reflecting stiff competition and a generally low level of claims.

Payouts worth a combined $500 million would dwarf previous big art losses, which include a 20 million pound ($33 million) hit from a 2004 warehouse fire in east London that destroyed work by British artists Damien Hirst and Tracey Emin.

In 2006, U.S. casino owner Steve Wynn put his elbow through a Picasso he owned, resulting in a claim of about $40 million.

Art insurance payouts are sometimes lower than the initial claim because of adjustments to reflect the market value of the artwork.

Copyright 2012 Reuters. Click for restrictions.Email ThisPrintNewslettersTweetCategories: National NewsTopics: AP / Reuters, art insurance, Catastrophe, Claims, Commercial Lines, fine art insurance, Superstorm SandyHave a hot lead? Email us at newsdesk

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Thursday, February 14, 2013

Sandy Blow to N.J.: Costly Work or Costlier Flood Insurance Premiums

January 25, 2013Email ThisPrintNewslettersTweetArticleComments

Superstorm Sandy landed one final stunning blow to New Jersey on Thursday, Jan. 24, as the state adopted rebuilding guidelines that come with sticker shock.

They will force homeowners in flood zones to spend tens of thousands of dollars to raise their houses now or pay exorbitant premiums of up to $31,000 a year for flood insurance later.

Gov. Chris Christie said he adopted flood maps issued late last year by the Federal Emergency Management Agency as New Jersey’s standard for rebuilding from the worst storm in its history.



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Allianz Estimates Sandy Impact at $670 Million; Won’t Affect Profit Forecast

January 18, 2013Email ThisPrintNewslettersTweetArticleComments

Germany’s Allianz SE has announced that its losses from Hurricane Sandy are estimated to total

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Friday, January 18, 2013

Selective Insurance: $100-$120M Preliminary Pre-Tax Gross Loss for Sandy

November 28, 2012Email ThisPrintNewslettersTweetArticleComments

Branchville, N.J.-based Selective Insurance Group today said a preliminary pre-tax gross Hurricane Sandy loss would be between $100 to $120 million and a pre-tax net loss of around $52 million, including reinstatement premiums and reinsurance recoveries.

About two-thirds of the claims are in personal lines with the remaining in commercial lines. Selective said one area of uncertainty remains business interruption claims, which are included in the estimates but are still developing as some businesses are not back to full operation.

Selective is the sixth-largest writer for the National Flood Insurance Program and expects record claim activity this quarter that will generate estimated, pre-tax, claim service revenue of $12 million, which will partially offset the $52 million loss. Together, these items will impact the fourth quarter statutory combined ratio by about 10 points, the insurer said.

‘A Significant but Manageable Event’

“Industry models have estimated Hurricane Sandy insured losses to be in a wide range of $10 to $25 billion,” said CEO Gregory Murphy. “The storm made landfall in our top market share state of New Jersey making this a significant but manageable event for Selective.

“We prepared for the storm as we always do and have had claims team members working around-the-clock since the day of the storm to assist our customers,” CEO Murphy said. “We are committed to resolving claims quickly and fairly to help our customers get their lives back in order.”

 

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Wednesday, January 9, 2013

Northeastern Fishing Industry Hoping for Help With Sandy Storm Losses

January 8, 2013Email ThisPrintNewslettersTweetArticle1 Comments

While Superstorm Sandy did highly visible damage to homes, boardwalks and roads, it also walloped the Northeastern fishing industry, whose workers are hoping for a small piece of any future disaster assistance that Congress might approve.

The storm did millions of dollars’ worth of damage to docks, fish processing plants and restaurants. But it also caused millions more in lost wages to boat employees who couldn’t work for two to three weeks, to truck drivers who had nothing to transport, and to other assorted industries that service commercial fishing.

The $9.7 billion measure to fund the National Flood Insurance program, passed by Congress last Friday, did not include anything for the fishing industry; a bill the Senate passed in December would have allocated $150 million for that purpose.

Some of the worst damage to fisheries in the region occurred at the Belford Seafood Cooperative on the Raritan Bay shoreline in Middletown, N.J., where the pounding waves destroyed a 75-foot-long dock, gutted a popular restaurant, and ripped away all five garage doors and parts of the exterior of office and storage buildings. The co-op’s manager, Joe Branin, estimates the damage at close to $1 million.

“We went three weeks before we were able to pack a fish,” said Branin, whose business was still without electricity in mid-December. “We lost almost all our equipment. It was three weeks before anybody could do anything.”

The restaurant, where diners could eat scallops and fillets literally right off the boat, had provided $5,000 to $8,000 a week in revenue that is now gone.

The co-op supported 50 families who either work directly for it or in supporting roles. Many of those workers simply did without a paycheck for weeks afterward. The situation was the same at New Jersey’s Viking Village port on Long Beach Island’s Barnegat Light, where boats were idled after the storm.

“We couldn’t get to work for two weeks because the infrastructure was all torn up here,” said Bob Brewster, who owns three of the port’s 45 fishing boats and estimates he lost between $10,000 and $20,000 in lost catch. “We were just twiddling our thumbs, waiting to get back out on the water. Everybody wants to make a living, and for a while, we couldn’t.”

In Hampton Bays, N.Y., Doug Oakland estimated two marinas he owns suffered between $800,000 and $1 million in damage. He estimates about a dozen other marinas in the eastern Long Island community were similarly affected.

“The marinas got beat up pretty hard. There’s a 75-foot section of our pier that’s just gone,” he said.

“There was about three to four weeks right after the storm where all the fish kind of disappeared,” he said. “The first two weeks, fishermen couldn’t even get out because a lot of their gear was buried in sand. With the gas shortage, there were no fuel trucks, and there really was no market to sell the fish to because nobody had power. There was no sense in even trying to catch them.”

Though most of the individual boats up and down the East Coast escaped damage, they were forced to stay at the dock because of a combination of problems.

That included damage to their home ports; torn-up roads that forced street closures and kept workers, truck drivers, and customers from reaching the docks; the disruption to normal fishing patterns after the storm that saw many profitable species chased away until the following year; and even difficulty in getting in and out of ports because of new sand bars.

A strong nor’easter a week after Sandy just made things worse.

“We couldn’t get trucks to transport the product,” said Dwight Kooyman, who manages two of Viking Village’s scallop boats. “I have five guys that work for me that couldn’t work that entire time. If they don’t work, they don’t get paid.”

They’re all waiting to see whether Congress includes them in the billions of dollars in storm reconstruction aid it is considering. Less than three weeks after the Oct. 29 storm, the U.S. Commerce Department declared a fishery resource disaster for New Jersey and New York. But all that did was authorize the federal government to disburse any aid that Congress approves. Specific plans for applying for and distributing any aid to fishermen still have to be formulated.

Dale Parsons is a fifth-generation fisherman at the Jersey shore, who owns a shellfish business in Tuckerton, and who used to own a commercial hatchery for tiny clams and oysters on the edge of Barnegat Bay — until Sandy destroyed it, causing several hundred thousand dollars’ worth of losses.

“It was millions of oysters and clams that won’t be spawned next year,” he said. “Even if we rebuild right now, it will take a good year, year and a half to get it together. It’s going to take a long time coming.”

The damage to seafood processors and docks is only part of the industry’s problems, Parsons said; he also fears reduced business from restaurants who see fewer tourists this summer and order less seafood.

“I’m just waiting to see what kind of business there’s going to be in the spring,” he said. “No one knows yet.”

Sandy also affected recreational fishing businesses, including coastal bait and tackle shops that were flooded. New Jersey officials are soliciting damage reports from individual businesses to help make the case that they need direct federal grants, not just loans. The state’s recreational fishing industry estimates it lost $160 million from the storm.

Bonnie Brady, executive director of the Long Island Commercial Fishing Association, said charter fishing boats suffered greatly because people were just not taking fishing trips in the weeks following the storm.

“The trains weren’t running, there was no gas to get out to the docks, so I’d say they lost substantial income,” she said.

In some places, Sandy actually appears to have helped, rather than hurt, the fishing industry. Maryland environmental officials say an influx of fresh water into the Chesapeake Bay may benefit the oyster population by helping to keep the disease known as dermo in check.

Gibby Dean, president of the Chesapeake Bay Commercial Fishermen’s Association, said the oyster harvest is the best it’s been in a long time — so good that people are giving up crabbing to go after oysters.

 

Copyright 2013 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.Email ThisPrintNewslettersTweetCategories: East NewsTopics: Sandy, Sandy loss for fishing industry, Sandy storm loss, Superstorm SandyHave a hot lead? Email us at newsdesk

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Tuesday, January 8, 2013

W.R. Berkley Estimates $40-$50 Million Net Loss From Sandy

December 14, 2012Email ThisPrintNewslettersTweetArticle2 Comments

W.R. Berkley Corp. announced it expects catastrophe losses attributable to Superstorm Sandy will be between $40 million and $50 million, before tax.

The Greenwich, Conn.-based insurer said Thursday its loss estimate gives consideration to all currently available reinsurance and is inclusive of reinstatement premiums.

W.R. Berkley Corp. is an insurance holding company that is among the largest commercial lines writers in the United States and operates in five segments of the property casualty insurance business: specialty insurance, regional property casualty insurance, alternative markets, reinsurance and international.

A number of insurers have announced their initial Sandy-related loss estimates in past several days. The Chubb Corporation said it estimates Sandy-related losses to be around $570 million after tax. The Hanover Insurance Group estimates the net after-tax earnings impact of the storm to be in the $120-to-$140 million range.

Additionally, The Hartford Financial Services Group said it expects pretax losses of $370 million from Sandy. American International Group said its preliminary estimate of after-tax Sandy-losses, net of reinsurance, is approximately $1.3 billion. New Jersey Manufacturers Insurance Company said its Sandy-related payouts could exceed $300 million.

 

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Friday, January 4, 2013

Attorneys Discuss Liability Insurance Coverage for Sandy Litigation

December 21, 2012Email ThisPrintNewslettersTweetArticleComments

Homeowners, businesses, and municipalities in the tri-state area continue to rebuild and rebound from Superstorm Sandy.

Often, large-scale devastation and destruction are followed by lawsuits against individuals and entities allegedly responsible for protecting, managing, and maintaining the damaged buildings. A handful of such lawsuits have been recently filed in New York City on behalf of residents of large residential buildings.

If these suits are predictive of future legal actions, individuals and entities charged with protecting and managing damaged buildings can anticipate lawsuits claiming monetary damages caused by inadequate preventative measures before Sandy, and insufficient recovery measures thereafter.

Additional allegations pled in these initial suits include negligence, permitting unlawful entry into residential buildings, and failing to mitigate damages.

These recent lawsuits and expected future lawsuits are reminders of the significant alleged liabilities that building owners, real estate development and management companies, and volunteer condominium and cooperative board members face in Sandy’s aftermath.

Even if Sandy-related lawsuits are ultimately unmeritorious, potential defendants likely will incur significant legal fees disproving their liability.

For those businesses facing potential liability from negligence and breached duties claims, liability insurance may be an important asset to help offset defense costs and settlement or judgment payments.

CGL Coverage for Defense and Indemnification of Businesses and Municipalities

Businesses and boards facing even completely groundless allegations made in suits seeking damages for acts or inaction leading up to and after Sandy should look for protection to their liability insurance policies.

Businesses frequently purchase Comprehensive General Liability (

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After Sandy, New York City Eyes Moving Power Gear Higher

December 14, 2012Email ThisPrintNewslettersTweetArticleComments

A major push is on to move New York City’s electrical infrastructure to higher ground or upper floors after Superstorm Sandy sent seawater pouring into low-lying substations and skyscraper basements and plunged half of Manhattan into darkness for four days.

The effort, likely to be enormously costly, will center partly on two old weaknesses brought into sharp relief by the surge: power distribution stations built just yards from the water’s edge, and electrical components located in vulnerable basements.

Ever since Thomas Edison built the world’s first central power station in a Manhattan seaport district in 1882, central elements of the island’s electrical infrastructure have been located along the waterfront. Ten of Con Edison’s 101 transmission and distribution substations sit in flood zones.



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South Carolina Emergency Officials Study Sandy for Lessons

November 28, 2012Email ThisPrintNewslettersTweetArticleComments

Emergency officials on the South Carolina coast are looking at Superstorm Sandy to try to learn ways to better prepare for future storms.

Horry County emergency management director Randy Webster has been looking at the impact of Sandy, The Sun News of Myrtle Beach reported.

The storm hit the East Coast on Oct. 29, causing problems from North Carolina to Maine. More than 100 deaths were reported, most from drowning in the storm surge. The storm had moved by Myrtle Beach two days earlier, far offshore.

Webster has considered what would have happened if Sandy had hit the area.

“The immediate coastal impacts would be just as catastrophic, but when you get into that larger infrastructure issue we don’t have the same issues,” he said.

The Grand Strand would not face the same problems with damage to the transportation network, Webster said. The concentration of the population is also much less than New York.

The storm would have been similar to Hurricane Hugo in 1989 as far as the storm surge, up to 13 feet, he said. But Sandy lacked Hugo’s winds.

“There’s more work to be done to recognize that storm surge needs to be at the forefront and not the category of the hurricane that represents the wind speeds,” Webster said.

Storm surge impacts have been studied for Horry and Georgetown counties. Study results for the rest of the state are expected to be ready before the 2013 hurricane season that begins in June, said Sam Hodge, Georgetown County’s emergency management director.

Both men worry about complacency, since Hugo was the last major storm to hit South Carolina.

“As prepared as we think we are, we don’t know until it actually happens,” Hodge said. “There’s the unknown of will the people actually evacuate? Will we have a death toll with people failing to evacuate like they did up there?”

 

Copyright 2012 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.Email ThisPrintNewslettersTweetCategories: Southeast NewsTopics: disaster preparedness, South Carolina, storm losses, Superstorm SandyHave a hot lead? Email us at newsdesk

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Saturday, December 15, 2012

Superstorm Sandy Stress Scenarios Won’t Impact Insurer Ratings: Fitch

November 8, 2012Email ThisPrintNewslettersTweetArticleComments

Even an extreme $40 billion scenario for property/casualty insurance industry losses from Hurricane Sandy would not drive material rating changes for insurers, analysts at Fitch Ratings said today.

In a report providing a sensitivity analysis of the event for 10 individual insurers with the largest potential exposure to the event

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Thursday, November 29, 2012

White House Request for Sandy Aid Expected to Include Flood Insurance Funds

November 28, 2012Email ThisPrintNewslettersTweetArticle3 CommentsThe White House is expected in the coming days to send Congress a multibillion dollar request to fund recovery from Superstorm Sandy, which caused an estimated $71 billion in damages in New York and New Jersey.

Congressional aides said there was no clear indication of the request’s size, but some said it would likely be at least $11 billion.

The Federal Emergency Management Agency’s disaster relief fund had access to about $7.8 billion as Sandy slammed the U.S. East Coast on Oct. 29, causing widespread destruction in coastal New York and New Jersey.

Lawmakers and analysts also said Congress will need to shore up the heavily indebted National Flood Insurance Program in the face of $12 billion in payouts resulting from Sandy, ranked as the second-worst disaster in U.S. history.

U.S. Senate Majority Leader Harry Reid, asked about the additional Sandy funding request, said: “Well, we can’t do anything with the disaster aid package until we get something from the White House, and I’m told that will be here as early as tomorrow or the next day.”

A White House official declined to provide any details about the administration’s plans. “We are working closely with our partners in the states and in Congress, but it’s premature to speculate on specific actions as we work to ensure the governors have the necessary support,” the official said.

Lawmakers from both parties have voiced support for providing additional disaster relief in Sandy’s wake, but a massive funding request from President Barack Obama could be disruptive to already tense negotiations over year-end tax hikes and automatic spending cuts.

“It’s bound to be large, and we’ll need to scrub it carefully to determine real needs from wishful requests, which will take a little time,” a senior House Republican aide said of the funding package.

Representative Chaka Fattah, a Democratic member of the House Appropriations Committee from Pennsylvania, introduced a $12 billion emergency disaster relief bill four days after Sandy hit. No action has been taken on the measure, which is expected to be superceded by the White House request.

The White House official said that the administration has already obligated more than $1.9 billion to support Sandy response and recovery efforts. This includes $960 million in direct assistance to individuals affected by the storm.

On Monday, New York Governor Andrew Cuomo said the state will need $41.9 billion, including $32.8 billion for relief costs and damage repairs and another $9.1 billion to mitigate potential damage from future storms.

New Jersey suffered at least $29.4 billion in overall losses, Governor Chris Christie said on Friday.

Congress has routinely approved emergency supplemental appropriations to cope with unanticipated disaster relief costs, most notably for Hurricane Katrina in August 2005.

Two weeks after that storm flooded New Orleans, Congress approved $62.3 billion in disaster appropriations. It added another $29 billion by Dec. 30 after Hurricanes Rita and Wilma hit the Gulf Coast, and another $19.3 billion for those storms by June 2006. Supplemental appropriations for Katrina costs were still being made as late as 2010.

FLOOD INSURANCE SHORE-UP

Lawmakers are expected to shore up the National Flood Insurance Program by raising its $20.8 billion borrowing authority ceiling, since it has a commitment to pay policyholders hit by Sandy.

The FEMA-run program is essentially the only U.S. flood insurer for residences.

Putting more money into the program would come months after Obama signed a law aimed at improving its finances. Congress bailed out the program after Katrina in 2005, and it is $18 billion in debt.

Senator Tim Johnson, a South Dakota Democrat and chairman of the Senate Banking Committee, will “closely monitor developments to make sure that the NFIP is able to meet its obligations and pay claims to policyholders,” a committee aide said.

FEMA has estimated Sandy-related losses of $6 billion to $12 billion. That is far beyond the insurance program’s more than $690 million in cash and $3 billion in untapped borrowing authority.

A spokeswoman for the White House’s Office of Management and Budget said that as of last week, FEMA had processed 133,461 flood claims from the storm and paid out $302 million.

 

Copyright 2012 Reuters. Click for restrictions.Email ThisPrintNewslettersTweetCategories: National NewsTopics: federal disaster aid, flood insurance funds, National Flood Insurance Program, NFIP funds, Sandy federal disaster aidHave a hot lead? Email us at newsdesk

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After Sandy, Lower Manhattan Limps Back to Life

November 28, 2012Email ThisPrintNewslettersTweetArticle1 Comments

The hum of massive mobile generators, boilers and pumps emerges blocks from Manhattan’s Financial District and turns into a steady din south of Wall Street — the now-familiar sound of an area laboring to recover from Superstorm Sandy.

Other parts of New York City have gotten mayoral visits and media attention after the Oct. 29 storm killed dozens of residents and tore apart homes in coastal neighborhoods.

Less obvious were the millions upon million gallons of sea water that wreaked havoc on subterranean electrical panels and other internal infrastructure throughout lower Manhattan, making them unusable even after power was restored to the area.

“There were waves on Wall Street, and it all ended up here,” Mike Lahm, a building engineer who rode out the storm at 120 Wall Street, said during a recent tour of the skyscraper’s basement.



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