Insurers face dollars 500m storm bill

LOSSES from the US storms at the weekend could cost the world's insurance market an initial dollars 500m ( pounds 347m), writes John Moore.

According to some estimates among Lloyd's insurance brokers this could be the highest insured loss in history, with claims eventually rising to more than dollars 200bn.

However, the loss to Lloyd's insurance market may be more limited than in the past. Many US insurers have been forced to carry large risks on their own books rather than spread them throughout the reinsurance community.

Reinsurers, including Lloyd's, which accounts for about 10 per cent of secondary insurance business, have been reluctant in the past few years to take on business from other insurance companies.

Whatever the loss for the world's insurers, it will add to the difficulties of Lloyd's of London, which is poised to announce record losses of more than pounds 2bn for its last trading account for 1990.

Hurricane Andrew last August cost the insurance market up to dollars 16.5bn in claims.