The July flooding in Japan caused by extreme levels of rainfall has now resulted in almost $1.5 billion of insurance claims paid, according to the latest figures from the General Insurance Association of Japan (GIAJ).
Recently, catastrophe risk modelling specialist AIR Worldwide estimated an insurance and reinsurance industry loss of somewhere between JPY 284 billion (US $2.6 billion) and JPY 423 billion (US $4 billion) from the extreme rainfall event and the flooding it caused.
This range looks increasingly likely to be breached as the value of claims paid following the rains and floods is rising rapidly and has now reached over JLY 165.7 billion (surpassing $1.47 billion at today’s exchange rate.)
The GIAJ explained that automobile insurance claims have now reached $241.7 million, fire insurance (so residential and commercial property) has reached $1.155 billion, and miscellaneous insurance including accident cover has reached $75.3 million.
This is from 62,841 accepted claims, a total this will likely continue to rise over the coming weeks and months.
These claims figures are likely only from Japanese domiciled insurance companies, so the figure won’t include all international players operating in the market.
Hence the eventual industry loss to insurance and reinsurance markets from these rains is expected to be much higher, putting the AIR estimate range firmly in play.
Again, like other recent Japanese events such as the Osaka earthquake we covered earlier today, it’s unlikely this loss from the extreme rains will alone create much in the way of claims for ILS fund markets, but combined the weather and catastrophe activity in Japan this summer could result in a dent to reinsurance firm earnings and potentially some small impacts to the ILS market.