16 July 2014 Insurance

Typhoon Neoguri losses could reach $1bn: Credit Suisse

Credit Suisse has estimated that Typhoon Neoguri could cause insured losses of around $1 billion, according to an update released by DCG Iris.

The typhoon passed west of Okinawa Island in Japan last week, causing localised flooding and landslides, damaging buildings and infrastructure as well as causing at least 55 injuries and seven deaths across Japan.

The report said: "Typhoons are the most frequent cause of property loss in Japan and winds are the predominant driver of loss, although Japan does have strict and well-enforced construction codes.

"Most losses from Neoguri will be due to damage to roofs and wall coverings. Flood damage is not covered under standard policies and flood insurance coverage is relatively low. Based on our analysis and assessment we currently expect insured losses possibly reaching around $1 billion given the extent of the damage resulting from Neoguri.

"The CS IRIS Low Volatility Plus Fund, the company's master fund, has exposure to Japan wind risk. However, based on the fund's exposure and the current industry loss estimates, we do not expect an impact on the performance of the fund.”

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