Home International Philippine quake to cost economy $1bn, industry $100m

Philippine quake to cost economy $1bn, industry $100m

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The earthquake which occured in the Philippines this week is expected to cost the regions economy around USD1 billion (£629m) but only USD100 million (£63m) of this is expected to fall on insurers, EQECAT has estimated.

EQECAT, the US based catestrophe risk management firm, said low insurance coverage in the region will mean insurers will only foot the bill of a fraction of the complete cost of repairs.

The madnitude 6.7 quake occurred on Monday the 6th of February and was followed by a series of strong aftershocks. Landslides, extensive damage and casualties have been reported.

The epicentre of the quake was some 600 kilometers south of the capital, Manilla. Very minor shaking was experienced in the capital.

The main expenses for insurers are expected to come from landslides and damage to older building from the shaking. Most of the countries earthquake resistant buildings escaped with little to no damage.

Exposure is changing rapidly in the region due to growing economic development. Buildings are often built on stilts to protect them from flood damage, however all building types are vulnerable to landslides.

Approximately 1 million people were exposed to violent shaking on Monday when the quake struck. Damage and casualties are expected to be concentrated in the vicinity of the epicenter, including Guihulngan City which has a population of 100,000.