EQECAT Post-Landfall Estimates of Insured Onshore Losses from Hurricane Gustav
September 2, 2008
Oakland, California
EQECAT, Inc., the leading authority on extreme-risk modeling, Tuesday afternoon (Eastern Time) said, based upon current assessment reports of damage caused by Hurricane Gustav, and additional post-landfall data regarding the storm's characteristics, it has reduced estimated onshore insured losses to a range of $3 to $7 billion, primarily in Louisiana, from an initial landfall estimate Monday of $6 to $10 billion.
EQECAT said it has not changed its estimate of damage and disruption related to production of crude oil and natural gas offshore in the US Gulf of Mexico. "We are reviewing additional information from energy companies and other sources, but continue to anticipate shut-in production for the next year will not exceed about 5 percent of the production capacity for crude oil, and 5 percent of production capacity for natural gas," said Tom Larsen, Senior Vice President. "The offshore estimates exclude any potential damage to onshore refineries, which we also will assess in coming days as information becomes available," he said.
EQECAT's estimates will be updated as additional information about the storm's characteristics, and on-the-ground observations by assessment teams, become available.
Beyond wind damage to commercial and residentialfixed structures, such as office buildings, factories, warehouses, and homes, EQECAT's insured loss estimates include business interruption, as a result of the destruction of property; and demand surge, which occurs when the demand for products and services to repair damage significantly exceeds the regional supply. Thus, these products and services may have to be brought to the region quickly from distant points, resulting in additional costs for transportation, packaging and manufacture.
Excluded from EQECAT's insured loss estimates are losses related to flooding, private and commercial automobiles and similar vehicles.
EQECAT, Inc. provides state-of-the-art products and services to the global property and casualty insurance, reinsurance and financial markets. EQECAT is the technical leader and innovator of catastrophe risk management models that quantify exposure to a range of natural and man-made catastrophic risks.
Through its modeling software platform, WORLDCATenterprise, EQECAT enables clients to quantify and manage the potential financial impact of natural hazards. WORLDCATenterprise includes 181 natural hazard software models for 95 countries spanning six continents. These models are based upon innovative applications of the latest science, engineering expertise, claims and exposure data and advanced mathematics.
EQECAT, a subsidiary of ABSG Consulting Inc., was founded in 1994 and is headquartered in Oakland, California.
For more information, contact:
pr@eqecat.com