Yesterdays two earthquakes, which were technically aftershocks of the September M7 quake and February event which devastated much of Christchurch, New Zealand, have been upgraded by the USGS to a magnitude 5.2 and a magnitude 6.0. Risk modeller EQECAT has issued a CatWatch report on this event and they estimate that the two earthquakes could cause as much as $3 billion to $5 billion in insured losses.
EQECAT says that yesterdays quake is expected to have caused damage mainly to buildings which had already been impacted by the previous quakes. They note that had the event occurred closer to February’s quake the damage estimate would have been lower, but as rebuilding work has progressed significantly they feel confident to put a $3 billion to $5 billion insured loss estimate on it.
Reinsurers will now be trying to work out whether they are on the hook for this event which will depend on how aftershocks are treated in their quake policies. Another loss in the billions will be particularly unwelcome for the local primary insurers who have exhausted much of their reinsurance cover from the earlier quakes and the flooding in Australia.