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INSURANCE

Scant insurance for Typhoon Haiyan: report

Disasters caused global economic losses of about $130 billion this year, Swiss Re said on Wednesday, but there was little insurance coverage for the deadliest catastrophe, Typhoon Haiyan in the Philippines.

Scant insurance for Typhoon Haiyan: report
Filipinos mourn dead this week from Typhoon Haiyan, which killed more than 6,000 people. The Philippines was largely uninsured for the natural disaster. Photo: Jay Directo/AFP

In a preliminary estimate of the impact of natural and man-made disasters, the Zurich-based reinsurance group noted that the economic impact was sharply down from $196 billion in 2012, a year marked by Superstorm Sandy in the United States.
   
But the total loss of life climbed to about 25,000 people from 14,000 in 2012, it said.
   
Last month's Typhoon Haiyan in the Philippines was the deadliest single disaster, killing more than 7,000 people, Swiss Re noted.
   
But despite the devastation wreaked, insured losses from the typhoon are expected to be modest, it said.
   
It pointed to the low proportion of insurance coverage in the Philippines —  a common issue in developing nations, which are also amongst the globe's most disaster-prone countries.
   
Swiss Re did not release an estimate for the Philippines, but insurance-and disaster-risk modellers AIR Worldwide recently put the economic losses at $6.5-14.5 billion, and insurance coverage at $300-700 million.
   
The latter figure accounted only for physical damage to insured buildings and their contents, and did not include such areas as losses of crops or business interruption, AIR Worldwide noted.
   
"In many parts of the world, insurance penetration remains low," Swiss Re's chief economic Kurt Karl said in a statement.
   
"Together with preventative measures, insurance can lessen the destructive impact and financial burden that large catastrophic events can have on people's lives," Karl said.

"It can also help accelerate reconstruction efforts, as we have seen in areas where insurance penetration is higher."
   
The insurance industry is likely to cover about $44 billion of the 2013 disaster losses, Swiss Re said.
   
It noted that the figure was substantially lower than the $81 billion in payouts last year, largely down to Superstorm Sandy.
   
The costliest single disaster of 2013, both in terms of losses and likely insurance payouts, was the flooding in June that battered Germany, the Czech Republic and neighbouring countries in central Europe.
   
The floods, which claimed two dozen lives, caused economic losses of around $18 billion, with $4 billion of that insured, Swiss Re said.
   
Insured losses were nonetheless higher than during the 2002 floods in the same region, which cost the industry $3 billion at current prices.
   
The June 2013 disaster ranked as the second most expensive fresh-water flood on record, but still lies a distant second to the 2011 Thailand floods which led to insured claims of over $16 billion, Swiss Re underlined.
   
Europe was also hit by Hailstorm Andreas in Germany and France in July, with insured losses of $3 billion.
   
The more recent Windstorm Christian and Windstorm Xavier in central and northern Europe triggered insured losses of around $1 billion each.
   
June rains and flooding in the Canadian province of Alberta led to insured losses of $2 billion, the highest ever recorded in the country for any disaster.
   
There were also heavy rains and floods in Australia, India, China, Indonesia, Southern Africa and Argentina this year.
   
Harsh spring and autumn weather caused severe thunderstorms and deadly tornadoes in the United States, but the 2013 North Atlantic hurricane season was benign, Swiss Re noted.
   
The company is set to release its definitive 2013 disaster data in March.

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PROPERTY

How to ensure your French property is insured for storm damage

Storm Ciaran’s property-wrecking passage through France - with another storm forecast for the weekend - may have many people wondering how comprehensive their insurance cover is. 

How to ensure your French property is insured for storm damage

In the wake of Storm Ciaran, thousands of property owners in France are preparing insurance claims – with initial estimates of the bill for damage between €370 million and €480 million.

Home insurance is compulsory in France, whether you own the property you live in or you rent – and it must include some level of storm damage cover. 

Check also to see if your insurance provides cover in case of a declaration of a catastrophe naturelle.

The garantie tempête (storm guarantee) covers damage caused by violent winds. What constitutes a ‘violent wind’ varies from contract to contract, but there appears to be a widespread consensus of agreement on wind speeds over 100km/h.

In most insurance contracts, this covers damage caused by the storm and within the following 48 hours – so you’re covered if, for example, a tree weakened by the storm comes down within that period and damages your property.

Be aware that, while the storm guarantee automatically covers the main property, it generally only covers any secondary buildings and light constructions – such as a veranda, shed, solar panels, swimming pool or fence – if they are specifically mentioned in the contract. 

The same is true of any cars damaged by debris. A basic insurance contract might not include storm damage, so it is always worth checking.

Damage must be reported to your insurer as quickly as possible. The deadline for making declarations is usually five days after any damage is noticed. This is especially important for second home owners, who may not be at the property when the damage occurs. 

In some cases – such as in the aftermath of Storm Ciaran – insurers may extend the reporting period. But under normal circumstances, it’s five days after the damage has been discovered.

What happens next

To make a claim, the first thing to do is contact your insurer by phone or email. Your insurer will take you through the next steps, but usually you have to send in a declaration – which should include an estimate of any losses and for any repairs, with evidence where possible, such as photographs and any receipts for purchases. 

Your insurer may also request proof of wind intensity, which can be provided for example by a nearby weather station.

The insurance company may appoint an expert to come and assess the damage, so make sure to keep damaged property safe until they arrive, as well as all invoices for any urgent repair work. 

What if you’re a tenant?

If you rent your property, you must report any damage inside the accommodation to your insurer and also notify your landlord so that they can file their own claim. 

In the case of a co-propriete, you must declare damage inside the accommodation to your insurer, while the trustee sends his own declaration to the collective insurance (which sometimes covers the private areas) .

How long does it take for claims to be settled?

Payment of the compensation provided for by the “storm guarantee” depends your home insurance contract. After the insurer has estimated the amount of damage, compensation is generally paid between 10 and 30 days following receipt of the insured’s agreement.

What if we got flooded?

In the case of flooding, you may have to wait for a natural disaster order to be issued. 

Catastrophe naturelle

The ‘state of natural disaster’ is a special procedure that was set up in 1982 so victims of exceptional natural events, such as storms, heavy rain, mudslides and flooding, as well as drought, can be adequately compensated for damage to property.

The government evaluates each area and deems whether it qualifies for the status of catastrophe naturelle (natural disaster). 

Essentially once a zone is declared a natural disaster, victims can claim from a pot of funds created by all insurers. If the zone is not declared a disaster, insurance companies are under no obligation to pay out. 

Under a “state of natural disaster” residents are covered for all those goods and property that are directly damaged by the phenomenon, in this case storms.

It applies to residential or commercial buildings, furniture, vehicles and work equipment that are already covered by insurance policies.

Homes must be already covered by a multi-risk insurance policy for the status of natural disaster to count.

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