The Ratings agency Fitch has made an estimate of the insurable losses from the earthquake in Turkey and Syria. As it explains, they are difficult to estimate as the situation evolves, but it seems likely that the economic cost will exceed $2 billion, although they could reach $4 billion or even more.
However, insured losses could be much lower, perhaps around 1 billion, due to low insurance coverage in the affected regions. The vast majority of insured losses will be covered by reinsurance, but the amount ceded is likely to be negligible in the context of the global reinsurance market, with no implications for reinsurers’ ratings.
Turkey, Syria earthquake
“Insurance coverage is likely to be low in most affected parties,” the agency says. Their report explains that the Turkish Catastrophe Insurance Pool (TCIP) was created after the 1999 Izmit earthquake to cover earthquake damage to residential buildings in urban areas. However, it does not cover personal loss, liability claims, or consequential losses, such as business interruption.
Although earthquake insurance coverage is technically mandatory in Turkey, it is very often not enforced in practice. As a result, many residential properties are uninsured, particularly in many of the affected areas, where low family income limits affordability.
Insurance coverage in the affected parts of Syria would likely be similarly low, particularly given the economic effects of the country’s civil war.
At the same time, the Fitch rating agency has said in its report published on Thursday that Turkey and Syria have suffered an economic loss of more than 400 million dollars, that is, more than 33,070 crore rupees in this terrible earthquake.
However, Fitch has also said that due to low insurance coverage in the affected areas, most of the damage caused is uninsured. According to the agency, of this only around Rs 8,268 crore ($100 crore) is insured.
As the days pass by, the chances of survival there are getting bleaker. According to statistics, where 29,600 people have died and 80,270 people have been injured in Turkey so far, 5,270 people have died and 14,500 people have been injured in Syria.
It has been known that more than 75 aftershocks were felt in the last two days after this seismic incident. According to the United States Geological Survey (USGS), it was followed by 29 more earthquakes on February 6 and 7, whose intensity was 5 or more on the Richter scale.
Thousands of buildings are known to have been damaged in both countries in this horrific tragedy, after which thousands of people have been left homeless and seek places of safety.
WHO senior emergency official Adelheid Marschang reported that after the earthquake and aftershocks, around 23 million people in Turkey and Syria are expected to be affected, including 1.4 million children.
Significantly, in this hour of crisis showing humanity, countless countries around the world, including India, have come forward to help Turkey and Syria. It is still feared that countless people are trapped, but their hopes of finding survivors grow bleaker as time goes on. Bad weather, internet connection and damaged roads are causing big problems in the rescue operation.
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