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New Zealand quake to cost insurers up to USD12 billion

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Swiss Re estimated Wednesday that February’s New Zealand earthquake would  cost insurers up to $12 billion.     “The total insured claims for the insurance sector for the earthquake in  New Zealand are estimated to be between $6 billion to $12 billion,” it said.

Swiss Re added that the deadly catastrophe which struck Christchurch was  expected to cost the Zurich-based group some $800 million before tax.    Costs to the industry were particularly high as take-up rates for  earthquake insurance were significant in New Zealand, the reinsurer noted.

It added that there remained uncertainties in its estimates and that the  preliminary forecasts could yet be revised.

Bank Vontobel pointed out that Swiss Re’s estimate suggests that the  earthquake will account for up to 80 percent of the reinsurer’s annual natural  catastrophe budget of $1.0 billion.

If claims of around $225 million from recent floods in Australia were  included, the total would account for the whole amount, barely two months into  2011, the bank said.

Grieving New Zealanders fell silent on Tuesday to mark the moment last week  when the 6.3 magnitude earthquake tore apart the country’s second largest city  and claimed hundreds of lives.

The reconstruction bill for the city has been estimated at up to NZ$16  billion ($12 billion).

Zurich, March 2, 2011 (AFP)

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