Beirut explosion to drive losses to multiple lines, says Guy Carpenter

Reinsurance broker Guy Carpenter has estimated the insured losses for combined hull, cargo and port facility from the recent explosions that shook Lebanon's capital Beirut on August 4 to be within $250 million.

The broker noted that there is still much uncertainty and speculation on the quantum of the insured loss, but admitted that the event is expected to drive losses to multiple lines.

The Governor of Beirut has estimated that the economic impacts of the blasts would be in the range of $10-15 billion.

The blasts in the Port of Beirut tragically resulted in at least 137 fatalities, 5000 injuries and widespread damage across a large area of the city. Much of the port has been totally destroyed, warehouses have collapsed and ships have overturned. The blast damage to the urban area adjacent to the port has also been severe.

The port is close to the centre of the city where retail and corporate real estate, as well as residential property, will have been affected.

At the same time, Guy Carpenter noted that property insurance levels remain relatively low in Lebanon despite recent market penetration. The penetration for industrial exposures near the port and for commercial lines will be higher, which could impact some of the international insurance market, it said.

From a marine perspective, the broker's vessel tracking capability found 40 vessels to be within a radius of 10 km of the blast, including ten vessels that were within 1.6 km of the explosion. Guy Carpenter expects those vessels would have incurred damages. Many other vessels were within a radius where sporadic damage may have occurred, it added.