Asia counts the cost of Typhoon Mangkhut

The clean-up from Typhoon Mangkhut has begun as the devastated areas of the Philippines, China and Hong Kong assess the loss of life and long-lasting damage that resulted from the most severe storm of the year so far. The super typhoon is also likely to raise the issue of the insurance gap in the region, given that insured losses in Hong Kong are likely to far exceed those suffered in the Philippines despite the loss of life in the latter. Early estimates suggest Hong Kong insurers could face a bill of more than HKD$1bn ($127m). However, the final bill could well be much higher, given that Mangkhut was rated as the strongest storm ever recorded to hit Hong Kong. It also eclipsed the strength of last year’s Typhoon Hato, which was rated as the strongest storm in more than half a century and caused between HKD$4bn and HKD$8bn in economic losses, but only limited insured losses. Mangkhut first hit the Philippines on Sunday with winds of up to 250km/h causing landslides and building collapses that led to at least 65 fatalities and more than 40 people missing. One site of devastation was the northern island of Luzon, where a number of people working on an illegal mining site were caught in a landslide. It is estimated that up to three million people were affected in the worst-hit parts of the country, while a further 11 million residents further south face the prospect of storm-surge flooding. While there has been widespread property damage to a number of public buildings such as schools, much of the damage has been in agriculture where insurance penetration is historically low. It is a similar story in China where there have been four fatalities, according to the official Xinhua News Agency. More than three million people have been told to evacuate by the authorities and about 640 tourist spots were closed. Hundreds of flights and high-speed rail journeys were cancelled and there was widespread damage to private and public buildings. According to reports, more than $80m-worth of insurance claims were made on Monday. The largest insurance bill is likely to be found in Hong Kong and Macau, where there were no fatalities but widespread damage to buildings and also costly business interruption. The share prices of major Hong Kong and Chinese insurers such as China Re, ZhongAn, Ping An, and PICC all suffered in the aftermath of the storm, falling between 1.5% and 7% before recovering to some degree, but still finishing the day down in value. General insurers and reinsurers are most likely to be affected by the storm, and business interruption claims are likely to be the costliest, from cancelled flights in Hong Kong airport to closed casinos in Macau. However, the fact that Hong Kong’s financial exchanges were able to open for business on Monday, the day after the storm hit, and that forecasters have not identified any more threats in the near future, may give insurers and residents some hope that the costs of Mangkhut can be absorbed.

Asia counts the cost of Typhoon Mangkhut

Want to read this article?

Read Next

Marsh tracks slowdown in global Q1 rate hikes

Markel names head of terrorism in London

Insurers defend Nord Stream’s €400m lawsuit as act of war

Allstate posts nat cat loss of $343m for March

UAE flash flood losses manageable as insurers adapt to changing weather

Marsh tracks slowdown in global Q1 rate hikes

Markel names head of terrorism in London

Insurers defend Nord Stream’s €400m lawsuit as act of war

Allstate posts nat cat loss of $343m for March

UAE flash flood losses manageable as insurers adapt to changing weather

Want to read this article?

Read Next

Marsh tracks slowdown in global Q1 rate hikes

Markel names head of terrorism in London

Insurers defend Nord Stream’s €400m lawsuit as act of war

Allstate posts nat cat loss of $343m for March

UAE flash flood losses manageable as insurers adapt to changing weather

Related Articles